Carbon tax policy progress in Northeast Asia

In Critical Issues in Environmental Taxation
Volume (Issue): 2011
Peer-reviewed Article
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This paper provides an overview of academic discussions and actual progress of a carbon tax policy in Japan, China and Republic of Korea located in Northeast Asia. Opportunities and barriers of introducing this policy in the region are identified by a comparative analysis of available information. The overview confirms the great importance of designing an appropriate policy scheme including the scope, tax level, tax collection and utilisation of the revenues. Our comparison shows the problems of implementing a carbon tax policy in the target countries. In Japan, opposition from industrial lobbies is the most crucial factor blocking this policy. The centralised administration system of China may shorten the preparation period for applying the policy in response to the increasing pressure of climate change mitigation. The general attitude towards carbon tax in Republic of Korea is positive among environmental scholars. Adding carbon tax as a complementary part of existing energy tax would be a more feasible way for Japan and Korea with both relying highly on fossil fuels from abroad. As the way forward, measuring the acceptability of industrial companies to carbon tax is useful to convince the policy-makers.