Earlier this week all of the living former Chairs of the Federal Reserve, 30 Nobel economists, and all but one former chair of the White House’s Council of Economic Advisers came out in support of a carbon tax proposal
for the United States. Carbon taxes put a taxable price on the greenhouse gas made by sectors or companies in the production and distribution of a good or service. It is one way among many ways to encourage businesses to internalize the cost of pollution to the environment.
Some of the most stringent carbon pricing policies are carbon taxes European countries
have implemented. Companies doing business in the EU already pay to pollute under the EU’s Emissions Trading System, and many countries have their own domestic policies to ensure that those targets are met. Sweden’s carbon tax cost about $139 per metric ton of carbon dioxide, while Switzerland’s carbon tax amounts to $101 per metric ton of carbon dioxide.
The United Kingdom
is the only country to make it to the list without holding a traditional carbon tax. The UK implements a system where the Treasury sets a minimum price the electricity sector
pays to pollute, in order to offset any carbon price fluctuations within the EU’s larger emissions trading system.