OECD Environment Working Papers
This series is designed to make available to a wider readership selected studies on environmental issues prepared for use within the OECD. Authorship is usually collective, but principal authors are named. The papers are generally available only in their original language English or French with a summary in the other if available.
- ISSN: 19970900 (online)
- https://doi.org/10.1787/19970900
The Political Economy of British Columbia's Carbon Tax
In July 2008, the Canadian province of British Columbia (BC) launched North America’s first revenue-neutral carbon tax reform. The tax, which applied to all combustion sources of all fossil fuels, was introduced at a rate of CAD 10 per tonne of CO2, with a schedule for annual increases of CAD 5 per tonne of CO2 until the tax reached CAD 30 per tonne of CO2 in 2012. Tax revenues were fully recycled via a combination of corporate and income tax cuts, phased in over time. This paper reviews the political economy of the BC tax in three distinct periods – its origins, its survival in the face of political backlash, and its longer-term prospects...
Keywords: political economy, policy lessons, carbon tax
JEL:
H23: Public Economics / Taxation, Subsidies, and Revenue / Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies;
Q48: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Energy / Energy: Government Policy;
Q58: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Environmental Economics: Government Policy;
P48: Economic Systems / Other Economic Systems / Other Economic Systems: Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies;
F18: International Economics / Trade / Trade and Environment;
Q5: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics;
Q38: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Nonrenewable Resources and Conservation / Nonrenewable Resources and Conservation: Government Policy
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