What is a carbon tax and how does it work ?
A carbon tax is a fee on burning carbon-based fuels to reduce emissions and mitigate climate change. It works by setting a price per ton of CO2 emitted, collected through reporting by businesses and sometimes individuals, with revenue used for dividends, clean energy investments, or government operations. The economic impact includes higher costs for polluting products, encouraging consumers and companies to choose cleaner alternatives. Environmentally, it reduces emissions and promotes clean energy. Socially, it can improve air quality but may affect low-income households. International cooperation prevents companies from moving to countries with lower taxes. Key considerations include supporting those financially burdened, ensuring compliance, and gaining public acceptance.