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Environmental Taxes

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Author Info
Don Fullerton
Andrew Leicester
Stephen Smith

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Abstract

This chapter provides an overview of key economic issues in the use of taxation as an instrument of environmental policy in the UK. It first reviews economic arguments for using taxes and other market mechanisms in environmental policy, discusses the choice of tax base, and considers the value of the revenue from environmental taxes. It is argued that environmental tax revenues do not significantly alter economic constraints on tax policy, and that environmental taxes need to be justified primarily by the cost-effective achievement of environmental goals. The chapter then assesses key areas where environmental taxes appear to have significant potential -- including taxes on energy used by industry and households, road transport, aviation, and waste. In some of these areas, efficient environmental tax design needs to make use of a number of taxes in combination -- a "multi-part instrument".

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 14197.

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Date of creation: Jul 2008
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Handle: RePEc:nbr:nberwo:14197

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Find related papers by JEL classification:
H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Cathal O'Donoghue, 1997. "Carbon Dioxide, Energy Taxes and Household Income," Papers WP090, Economic and Social Research Institute (ESRI). [Downloadable!]
  2. Taheripour, Farzad & Khanna, Madhu & Nelson, Charles, 2005. "Welfare Impacts of Alternative Public Policies for Environmental Protection in Agriculture in an Open Economy: A General Equilibrium Framework," 2005 Annual meeting, July 24-27, Providence, RI 19317, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
  3. Don Fullerton & Inkee Hong & Gilbert E. Metcalf, 1999. "A Tax on Output of the Polluting Industry is Not a Tax on Pollution: The Importance of Hitting the Target," Discussion Papers Series, Department of Economics, Tufts University 9908, Department of Economics, Tufts University. [Downloadable!]
    Other versions:
  4. Kverndokk,S. & Rosendahl,E., 2000. "CO2 mitigation costs and ancillary benefits in the Nordic countries, the UK and Ireland : a survey," Memorandum 34/2000, Oslo University, Department of Economics. [Downloadable!]
  5. Coxhead, Ian, 2000. "Tax Reform and the Environment in Developing Economies: Is a Double Dividend Possible," Staff Paper Series 431, University of Wisconsin, Agricultural and Applied Economics. [Downloadable!]
    Other versions:
  6. Gilbert E. Metcalf, 2008. "Designing A Carbon Tax to Reduce U.S. Greenhouse Gas Emissions," NBER Working Papers 14375, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  7. James M. Poterba, 1991. "Tax Policy to Combat Global Warming: On Designing a Carbon Tax," NBER Working Papers 3649, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  8. Johnstone, Nick & Alavalapati, Janaki, 1998. "The Distributional Effects of Environmental Tax Reform," Discussion Papers 24140, International Institute for Environment and Development, Environmental Economics Programme. [Downloadable!]
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  10. Brita Bye & Snorre Kverndokk & Knut Rosendahl, 2002. "Mitigation costs, distributional effects, and ancillary benefits of carbon policies in the Nordic countries, the U.K., and Ireland," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 7(4), pages 339-366, December. [Downloadable!] (restricted)
  11. Elizabeth Symons & John Proops & Philip Gay, 1994. "Carbon taxes, consumer demand and carbon dioxide emissions: a simulation analysis for the UK," Fiscal Studies, Institute for Fiscal Studies, vol. 15(2), pages 19-43, May. [Downloadable!]
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