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Understanding the political challenges of introducing a carbon tax in Indonesia

Rakhmindyarto Rakhmindyarto and Dhani Setyawan

MPRA Paper from University Library of Munich, Germany

Abstract: Indonesia is the 6th largest carbon emitter in the world. It is also one of the most vulnerable countries to climate change, with a population of 250 million people spread across thousands of islands and low-lying coastal areas. This paper investigates the political challenges to introduce a carbon tax as a climate policy option in Indonesia. It is based on the analysis of 29 in�depth elite interviews with key Indonesian stakeholders. It fnds that, while political elites seem, in principle, to be open to the idea of a carbon tax, they are also cognisant of the impact of corruption challenges in the Indonesia context. Meanwhile, the business community opposes a carbon tax and fears the introduction of additional costs that may infuence productivity and competitiveness. Non-government organisations, however, support its immediate introduction. Overall, this work makes an important contribution to the ever-growing academic debate on the introduction of carbon prices to assist carbon mitiga�tion eforts. It also has important ramifcations in terms of transparency, accountability and political pluralism in Indonesia.

Keywords: Climate; change; ·; Climate; policy; ·; Carbon; prices (search for similar items in EconPapers)
JEL-codes: H2 H23 (search for similar items in EconPapers)
Date: 2020-04-08, Revised 2020-08-02
New Economics Papers: this item is included in nep-ene, nep-env, nep-pol and nep-sea
References: Add references at CitEc
Citations: View citations in EconPapers (1)

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