Carbon tax news story – a brief introduction.
The carbon tax news has been doing the round for past few days. Recently Australia came to limelight by becoming the first country to abolish ‘Carbon Tax’.
So we are giving a referential guide on carbon tax here.
With the expansion of industry,plants and machinary increased the demand of fuels that nourish them. This has hightened the dependency on fossil fuels. But burning of fossil fuels releases carbon-dioxide and other Green House Gases (GHG) to atmosphere. These GHG are the major cause of global warming resulting rise in sea level along with other environmental illness like extreme weather disturbances, acid rain etc. The truth is if we donot take any step these problem will get much worse in the coming years. The fossil fuel industry is destroying planet with impunity and getting rich while doing this. So to put a cap on GHG economists adopted a new potentially cost-effective method,known as CARBON TAX.
2. What is carbon tax ?
Every article on carbon tax news (appearing in newspaers or TV) has always tickled our curious brains sofar. As per wikipedia it is a tax levied on the carbon content of fuels. This is a form of ‘Pigouvian tax’ works on the principle of ‘Negative externalities’.
[Negative externalities- the cost 3rd party has to pay as a result of economic transaction between 2 parties. Producers and consumers are 1st and 2nd parties, where 3rd parties include individual, property,environment etc].
This is a form of pollution tax or a compensation cost to the damage done to environment due to carbon emission. When Negative externalities exist producers don’t take responsibility for external cost(borne by the 3rd party-the sufferer) passed on to the society. When producers consume fossil fuel the pollution released has a societal cost. Though the consumers get benefitted, rest of the society suffers due to pollution. Proponents of CARBON TAX beilieve that cost of fossil fuel should account for these societal cost. If you are polluting everyone’s detriment you have to pay for it.
i) Lower GHG emission due to tax constraint.
ii) Business and individuals use less energy derived from fossil fuels.
iii) Companies may switch to perpetual sources of energy like solar energy,wind energy etc. Thus saving the fuels for the future generation.
Reading articles related to carbon tax news will give you better result. Hope you liked this article.