Nowadays one of the most debated issues around the world is how to reduce carbon dioxide emissions to fight climate change, a carbon tax is one of the most commonly recommended proposals. According to Morris (2008) a carbon tax is a tax on energy sources which emit carbon dioxide. It is a pollution tax, which some economists favour because they tax a 'bad' rather than a 'good' (such as income). Moreover, climate change poses serious risks to both the environment and the economy. Scientists project that, depending on future greenhouse gasses(GHG) emissions, by 2100 average global temperatures will be 2°F to 11.5°F higher than now (Dasgupta, 2014). These higher temperatures create more frequent, damaging and extreme weather events, such as cyclones, …show more content…
The Industry needs more time to make such investment to meet the new changes towards the environment. However, there is the need for the planning approval to be recognized, with the possibility for it to proceed within four more years. It would be a better solution to advise the industry that CO2 will be taxed at about $50/$60 a ton in 10 years' time when trading partners. That will increase the price on carbon and the carbon industry; therefore the carbon industry should start to adjust its long term and future financial plans debts. In Australia there has been an increase within the cost of fuel, which is already affecting local prices. The government must be careful not to negatively impact households and businesses twice over. If the domestic price for gas continues to raise the price for CO2 the Australian government will have to raise further action to force the change from coal to gas generation. Furthermore, according to Dinan (2013) calculating the value of the damage is filled with uncertainties, estimates of that value span a large …show more content…
According to (Dinan, 2013), politicians could use the money raised from a carbon tax to bring down federal budget losses, to minimize current minor tax rates, or to reimburse the people who would receive an unequal portion of the cost of the carbon tax. All of those uses would have different results. Generally, these solutions on how to handle the money raised from the tax would not encourage reasons for businesses and households to reduce emissions that could be reached at a price below that of the tax. An exception would appear if households or companies received payment that was linked to their expenditure of fuels. In that case, using more fuels would raise their payment, discouragement incentives to stop the emissions (Dinan,