The Economic impact of different carbon tax revenue recycling schemes in China: A model-based scenario analysis
Date
2015
Authors
Liu, Yu
Lu, YingYing
Journal Title
Journal ISSN
Volume Title
Publisher
Pergamon Press
Abstract
As an important policy instrument for climate mitigation, the carbon tax policy design and its consequent social-economic impact calls for more research. In this paper, a dynamic Computable General Equilibrium (CGE) model – CASIPM-GE model is applied to explore the impact of a carbon tax and different tax revenue recycling schemes on China’s economy. Simulation results show that the carbon tax is effective to reduce carbon emissions with mild impact on China’s macro economy. In particular, a production tax deduction can be used to recycle the carbon tax revenue if the government wants to reduce the cost of a carbon tax; however, a consumption tax deduction may help the economy to restructure and may benefit the long-run emissions reduction. In terms of industrial output, mostindustries are negatively affected; sectors with large share of exports are subjected to negative shocks if there is consumption tax deduction financed by the carbon tax revenue. The study suggests that carbon revenue recycling scheme is important in designing the carbon tax policy: a well-designed scheme can help reduce the cost of a carbon tax.
Description
Keywords
Citation
Collections
Source
Applied Energy
Type
Journal article
Book Title
Entity type
Access Statement
License Rights
Restricted until
2037-12-31
Downloads
File
Description