Environmental Tax Reform: Principles from Theory and Practice to Date
AbstractThis paper recommends a system of upstream taxes on fossil fuels, combined with refunds for downstream emissions capture, to reduce carbon and local pollution emissions. Motor fuel taxes should also account for congestion and other externalities associated with vehicle use, at least until mileage-based taxes are widely introduced. An examination of existing energy/environmental tax systems in Germany, Sweden, Turkey, and Vietnam suggests that there is substantial scope for policy reform. This includes harmonizing taxes for pollution content across different fuels and end-users, better aligning tax rates with values for externalities, and scaling back taxes on vehicle ownership and electricity use that are redundant (on environmental grounds) in the presence of more targeted taxes.
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Bibliographic InfoPaper provided by International Monetary Fund in its series IMF Working Papers with number 12/180.
Date of creation: 01 Jul 2012
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This paper has been announced in the following NEP Reports:
- NEP-ACC-2012-08-23 (Accounting & Auditing)
- NEP-ALL-2012-08-23 (All new papers)
- NEP-ARA-2012-08-23 (MENA - Middle East & North Africa)
- NEP-ENE-2012-08-23 (Energy Economics)
- NEP-ENV-2012-08-23 (Environmental Economics)
- NEP-PBE-2012-08-23 (Public Economics)
- NEP-SEA-2012-08-23 (South East Asia)
- NEP-TRE-2012-08-23 (Transport Economics)
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