Compensating households from carbon tax regressivity and fuel poverty: a microsimulation study

Audrey Berry

No 2017.08, Policy Papers from FAERE - French Association of Environmental and Resource Economists

Abstract: For households, taxing carbon raises the cost of the energy they use to heat their home and to travel. This paper studies the distributional impacts of the recently introduced French carbon tax and the design of compensation measures. Using a microsimulation model built on a representative sample of the French population from 2012, I simulate for each household the taxes levied on its consumption of energy for housing and transport. Without recycling, the carbon tax is regressive and increases fuel poverty. However, I show how compensation measures can offset these impacts. A flat cash transfer offsets tax regressivity by redistributing

Keywords: Carbon tax; Distributional impacts; Fuel poverty; Revenue recycling; Microsimulation (search for similar items in EconPapers)
JEL-codes: I3 Q5 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2017-12
New Economics Papers: this item is included in nep-cmp, nep-ene, nep-env, nep-eur, nep-reg and nep-tre
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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http://faere.fr/pub/PolicyPapers/Berry_FAERE_PP2017_08.pdf First version, 2017 (application/pdf)

Related works:
Working Paper: Compensating households from carbon tax regressivity and fuel poverty: a microsimulation study (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:fae:ppaper:2017.08

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