- tax levied on carbon content of fuels
- increases competitiveness of non carbon energy
- revenue raised can be used to:
- fund non carbon technologies
- offset higher prices for certain sectors of the economy ( ie low income households, trade exposed industries)
- success of a carbon tax to reduce overall emissions depends on
how carbon tax revenue is managed
- should be invested back into ‘clean’ technology, otherwise benefits of scheme are limited
- price signal not generally enough to drive significant reduction
Some Potential Benefits of Carbon Tax:
- TAX CUTS. The revenues from carbon pricing could be used to fund cuts in other tax rates. …
- RETURNING MONEY TO HOUSEHOLDS OR ELECTRICITY CONSUMERS. Revenue from carbon pricing could be returned to households by sending them “lump sum” payments, which could be divided equally or by some alternative metric….
- DEFICIT REDUCTION….. Carbon pricing revenues could be used to reduce annual deficits and thereby help to avoid such adverse economic effects.
- INVESTING IN COMBATING CLIMATE CHANGE. In addition to its potential to stimulate innovation in low-carbon technologies (for example, renewable energy), a carbon price can provide revenue to help promote the development and deployment of breakthrough technologies
- TRANSITIONAL ASSISTANCE. A portion of the revenues can be used to assist those likely to be most adversely affected by a carbon price…
Starting August 30, 2019, gasoline retailers in Ontario must display a Federal Carbon Tax Transparency Sticker on each gasoline pump.https://www.ontario.ca/