Carbon Taxing: Towards a Greener Future
Carbon taxing. It’s a source of controversy for national governments. They’re forced to decide between the environment and long term public health or the economy, the basis of the entire nation. So which one’s more important?
by Sriya Gundlapally
Carbon taxing may seem positive because of its intended environmental benefits, but it also causes controversy politically and economically. Many countries are debating on whether or not to implement carbon taxing due to the potential problems it may cause companies of varying industries and sizes. They are trying to answer this question: is the environment more important or is the economy more important?
This is where the trilemma comes into play: Should carbon taxing be implemented, should it not be implemented, or is there a neutral solution? Let’s find out.
Carbon Taxing Should Be Utilized
Carbon taxing is the action of placing a tax on the amount of environmental damage a person causes through carbon dioxide emissions. This policy is meant for a reduction in greenhouse gases since consumers and businesses will try alternative methods in order to avoid the tax.
Environmentally, carbon taxing can greatly lower carbon dioxide emissions, leading to better air quality, slower global warming, fewer wildfires, and other benefits. According to the Center for Climate and Energy Solutions, carbon taxing encourages companies to switch to more environmentally friendly methods in order to avoid the tax. In today’s world, nearly 87% of all carbon dioxide emissions come from the burning of fossil fuels. This means, by taxing carbon, businesses that predominantly use fossil fuels will contribute less carbon emissions and, in turn, lead to a greater decrease.
Additionally, governments are expected to earn more money—an estimated $2.2 trillion—over just 10 years if a carbon tax of $50 per metric ton of carbon dioxide is placed. This much money would have the potential to support several different causes and alleviate many issues. It could play a part in solving world hunger, or providing medical aid to citizens in wars. Moreover, the corporations would not have to worry about spending too much on carbon taxes if they choose to go green. Going with greener solutions would save time and money while also benefiting the environment greatly. Overall, enforcing a carbon tax will be a motivation for the world to save our planet.
Carbon Taxing Should Not Be Utilized
Caption: In the picture above, blue indicates that a carbon tax is being used or is surely being used soon. Some of the “blue” countries are Mexico, South Africa, and Japan. On the other hand, the yellow means carbon taxing is in consideration of being enforced. For example, the yellow indicates that Canada is considering whether or not a carbon tax should be implemented.
Although there are many benefits to carbon taxing, there are still some negative aspects to account for. First of all, carbon taxing has the potential to negatively impact businesses, despite their good intentions. In previous years, there have been issues since carbon taxing was focused on the future, failing to consider present situations. Economists saw social issues related to this as problems such as wars, poverty, and disease were left unaccounted for. Apart from the apparent negative impacts, the carbon tax has also proved ineffective in some areas. For example, California has carbon taxing in place and there has been little to no difference. In many cases, governments are struggling to effectively determine the right price for a carbon tax in order to account for the amount of environmental impact and reasonability along with factors such as the climate, the location, and much more. Due to this, a large variation in the range of “optimal” price occurs. In the midst of this decision, carbon dioxide reduction and such takes many years and this tax would take a lot of time and effort to determine.
So, is carbon taxing the right way to go? Well, it will prove to benefit the environment and raise money for different initiatives, but the amount of effort to discern the fair pricing will make it difficult to act immediately. Taking the businesses, economy, environment, and other factors into account will allow for more just pricing.
Fortunately, there is a way in which the carbon tax can stand as an environmentally-friendly policy without negatively impacting the public. Economists, environmentalists, and other related professionals should first work together to set a date to reach zero-emission. It is then important for policymakers to focus on how to achieve this end goal, making sure that it accounts for the situations of various nations. Based on these previous steps, the carbon price should be determined. Once this part of the world is accounted for, other national governments should follow their lead. In places where carbon emissions are high, the price would be high, too, but it should be payable.
Carbon taxing does have drawbacks and positives, but nations can work out the issues and work towards a greener future.