Carbon tax refers to the tax levied on carbon dioxide emissions. It aims to protect the environment and hopes to slow down global warming by reducing carbon dioxide emissions. Carbon tax can reduce fossil fuel consumption and carbon dioxide emissions by taxing fossil fuel products such as gasoline, aviation fuel and natural gas downstream of coal and oil according to their carbon content. Different from the greenhouse gas emission reduction mechanism based on market competition, such as total control and emission trading, carbon tax can be realized with very little management cost.
The main purpose of carbon tax is to reduce greenhouse gas emissions. Carbon tax is levied according to the amount of carbon emitted after burning fossil fuels. Therefore, in order to reduce expenses, public utilities, commercial organizations and individuals will strive to reduce the use of energy generated by fossil fuels. Individuals can give up private cars, take public transport and use energy-saving lamps (CFL) instead of incandescent lamps. Business organizations can improve energy efficiency by installing new equipment or updating heating/cooling systems. Utilities can use waste washing towers, low nitrogen oxide burners or gasification methods to reduce greenhouse gas emissions. Because the carbon tax sets a clear price for carbon emissions, the high investment in improving energy efficiency can be rewarded accordingly. Carbon tax makes alternative energy more cost-competitive than cheap fuel, and then promotes the use of alternative energy. Carbon tax revenue. These revenues can be used to fund environmental protection projects or reduce taxes.