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Environmental taxation in an optimal tax framework

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  • Thomas Sadler

Abstract

An extended and descriptive optimal tax framework is used to identify the objectives of environmental taxation, analyze the portfolio problem, and explore the trade-offs of policy design. Optimal tax criteria include efficiency, equity, administration, compliance, and revenue. The portfolio problem means that the policy maker must compromise to accommodate trade-offs of competing policy objectives. The regulator may attempt to increase efficiency, maintain a fair distributional impact, minimize the costs of administration and compliance, and implement an efficient use of revenue. The best opportunity to enhance policy effectiveness lies in improving the trade-offs between policy objectives. Copyright International Atlantic Economic Society 2001

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  • Thomas Sadler, 2001. "Environmental taxation in an optimal tax framework," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 29(2), pages 215-231, June.
    • Handle: RePEc:kap:atlecj:v:29:y:2001:i:2:p:215-231
    DOI: 10.1007/BF02299139
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