Carbon tax revenue should be put towards funding free green electricity and clean public transport to cut down individuals’ emissions.
That’s the claim of a new study by the University of Leeds, which has found that providing these services for free could reduce home energy emissions by 13.4% and motor fuel emissions by 23.8%.
It stresses that although low-income households contribute less to climate change than those with a higher income, they pay the same carbon tax rate on home energy and motor fuel.
The researchers have suggested that using the revenue from those taxes to cut down emissions, fuel and transport poverty would be far more useful than simply redistributing it throughout the population.
They state this would not only lessen the financial stress paying these taxes puts on lower income households but would also incentivise more people to adopt cleaner measures from different backgrounds – as a key factor getting in the way of everyone using clean energy and technologies is their price.
The study revealed that giving cash back through tax rebates, as opposed to using it to fund free green transport or cheaper renewable electricity will not lead to the same cut in emissions.
Lead author, Dr Milena Buchs, commented: “Stringent climate policies, including carbon taxes on home energy and motor fuels, are likely to be part of government strategies to achieve climate targets but they put higher burdens on low-income households than on rich households.
“Governments urgently need to make climate policies fairer by finding ways that can compensate disadvantaged people.
“Providing people with green living options, like free green electricity and free public transport, is promising because it’s re-distributive, saves emissions and reduces fuel and transport poverty.”