Carbon tax @70 USD/ton would be an ace move to counter the greenhouse gas emissions according to the International Monetary Fund.
The IMF explains that the tax does not only encourages a reduction in energy consumption but also favors cleaner energies. Other than the nonmonetary aspects, it generates revenue to finance sustainable and more inclusive growth.
It is expected that countries like China, India and South Africa which heavily rely on coal would be able to drop the carbon emission by 30% against the tax rate of 35 USD/ton.
Comparatively, a drop of just 10% would be possible by the countries like Ivory Coast, Costa Rica or France, as they consume much lesser coal.
The Paris Agreement, adopted by over 200 countries in 2015 aims to cap the overall increase in global temperatures by 2 degrees centigrade above the pre-industrial era.
Currently, carbon taxes remain unpopular, particularly in France, where plans to increase it to 55 euros (or USD 61.60) from 44.60 euros recently ignited the Yellow Vest protest movement.
What is the Carbon Tax?
A carbon tax is a tax levied on the carbon content of fuels. It is a form of carbon pricing. Carbon is present in every hydrocarbon fuel (coal, petroleum, and natural gas) and converted to carbon dioxide (CO2) – SRC: Wikipedia