The use of revenues from carbon pricing

Melanie Marten and Kurt van Dender

No 43, OECD Taxation Working Papers from OECD Publishing

Abstract: The paper collects comprehensive and detailed data on what 40 OECD and G20 economies do with the revenues from carbon taxes, emissions trading systems, and excise taxes on energy use. It notes that constraints – which can take the form of political commitments or legal earmarks – on revenue use differ between carbon taxes, emissions trading systems, and excise taxes. Constraints are less common for excise taxes, which also raise the most revenue. Carbon tax revenues are relatively often associated with environmental tax reforms, involving reductions in personal or corporate income taxes. Revenues from emissions trading systems are frequently directed towards green spending. The results may be relevant to the political economy of ambitious carbon pricing schemes in the sense that the political expedience of choices on revenue use may depend on the amount of revenue raised.

Keywords: carbon pricing; climate change; effective carbon rates; environmental tax reform; external costs (search for similar items in EconPapers)
JEL-codes: H21 H23 Q41 Q48 Q54 Q58 (search for similar items in EconPapers)
Date: 2019-06-05
New Economics Papers: this item is included in nep-ene, nep-env, nep-pbe, nep-pub and nep-reg
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:oec:ctpaaa:43-en

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