A green reform is not always green
AbstractThis paper analyses a tax reform, explicitly conceived by policy makers to be climate-friendly, that partly replaces a high vehicle registration tax by road user charging and allows for differentiation of the remaining registration tax by fuel efficiency. A microeconomic framework is proposed to analyse such a reform. For the case of Denmark, the analysis shows that the reform is likely to yield a significant and robust welfare gain. However, it seems not unlikely that CO2 emissions from passenger cars may increase as a result of the reform.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 42264.
Date of creation: 2013
Date of revision:
Congestion; Road user charging; Tax reform; CO2; Welfare economics; Registration tax;
Find related papers by JEL classification:
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
- R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion
This paper has been announced in the following NEP Reports:
- NEP-ACC-2013-05-24 (Accounting & Auditing)
- NEP-ALL-2013-05-24 (All new papers)
- NEP-ENE-2013-05-24 (Energy Economics)
- NEP-ENV-2013-05-24 (Environmental Economics)
- NEP-RES-2013-05-24 (Resource Economics)
- NEP-TRE-2013-05-24 (Transport Economics)
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