Source: What a carbon tax can do and why it cannot do it all
…A carbon tax reflecting the social cost of carbon is viewed as an essential policy tool to limit carbon emissions: high prices for carbon-emitting goods reduce demand for them. The carbon tax is generally levied on fossil fuels. Some countries have already adopted such a tax and discussions are ongoing in others. There are proponents of a global carbon tax too. Yet, governments are often keener to adopt measures other than a tax to contain carbon emissions. And amongst countries that have adopted a carbon tax, the levels vary substantially, and other measures exist alongside it. It is natural to ask why a carbon tax is not used universally in preference to other policies to limit emissions and why, even if there is such a tax, other policies are needed too.
Leave a Reply