What are carbon Taxes

     Carbon taxes are taxes on environmental emissions of carbon dioxide and other green house gases. They work in correlation with the Kyoto Protocol, carbon reductions and more.

     Carbon taxes are effective taxes on the use of fossil fuels. There are schemes to include other green house gasses with global warming potential when internationally accepted scales of equivalence for other green house gases in units of tons of carbon dioxide equivalents.

     The purpose of carbon tax is to protect the environment through the reduction of emissions of carbon dioxide. This will also slow climate change that is caused by global warming. This can be implemented by taxing the burning of fossil fuels. This includes coal, petroleum, and natural gas. The direct taxation concept of carbon taxes has the benefit of being easily understood. They may also be able to help fund environmental projects.

     To understand carbon taxes it is important to understand why they are being created, and how they originated. The Kyoto Protocol is currently responsible for carbon taxes and their future.

     The Kyoto Protocol is a code of behavior set up for the United Nations Framework Convention on Climate Change (also referred to as UNFCCC or FCCC). This is an international environmental treaty. Their goal is to achieve “stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.” This means that the Kyoto Protocol establishes a legally binding commitment for the reduction of four main greenhouse gases: carbon dioxide, methane, nitrous oxide, and sulfur hexafluoride. The Kyoto Protocol also focuses upon two groups of gases produced by the industrialized nations listed Annex I of the original Protocol. These gases are hydro fluorocarbons and per fluorocarbons.

     The Kyoto protocol deals with something called flexible mechanisms. This includes emissions trading, the clean development mechanism, and joint implementation. These things allow industrial countries to meet their green house gas emission targets. This works through the purchase of green house gas reduction credits. These are found through financial exchanges and projects that reduce emissions in non-industrialized companies. There are financial incentives in place to develop green house gas emission reduction projects. This plan instills the use of carbon credits. These carbon credits can be sold to buyers attempting to lower their greenhouse gas emissions. This encourages sustainable country development. This allows low green house gas emitting industries with high prevailing environmental standards to purchase carbon credits. This means that they can purchase these credits internationally in comparison to reducing green house gases domestically.

     The Kyoto Protocol is working to make carbon taxes an affirmed practice, which will benefit people worldwide. They are beginning this practice through environmental education. The hope is that the general population will become interested enough to learn more about the use of carbon and carbon taxes.