Aldy, JosephLey, EduardoParry, Ian2012-08-132012-08-132008-07https://hdl.handle.net/10986/11147This note argues that a carbon tax system is more practical to implement, monitor and enforce than tradable permit-based approaches to global climate-change action. It suggests that a sensible design will be an upstream carbon tax on the fossil fuel supply chain, which can also include other major non-(carbon monoxide) CO2 greenhouse gases (GHGs). While risks such as fiscal cushioning exist, a tax-based system will be more transparent and offer the appropriate incentives for participation and compliance.CC BY 3.0 IGOABATEMENTABATEMENT COSTSADDED TAXAPPROACHATMOSPHEREBASELINE EMISSIONSBORDER TAXCARBONCARBON CONTENTCARBON EMISSIONSCARBON PRICECARBON TAXCARBON TAXESCLIMATE CHANGECLIMATE CHANGE MITIGATIONCLIMATE POLICYCLIMATE SCENARIOSCOALCONSUMPTION OF ENERGYDISTRIBUTION OF COSTSELECTRICITYEMISSIONEMISSION PERMITSEMISSION SOURCESEMISSION TARGETEMISSION TARGETSEMISSIONSEMISSIONS ABATEMENTEMISSIONS QUOTASEMISSIONS REDUCTIONSEMISSIONS TARGETSEMISSIONS TAXEMISSIONS TAXESENERGY INDUSTRIESENERGY POLICYENERGY TAXESENVIRONMENTAL BENEFITSENVIRONMENTAL POLICIESFOSSILFOSSIL FUELFOSSIL FUEL SUPPLYFUEL SOURCEFUEL SUPPLYFUEL SUPPLY CHAINFUELSGASOLINEGASOLINE TAXGLOBAL CLIMATE CHANGEGREENHOUSEGREENHOUSE GASGREENHOUSE GAS EMISSIONGREENHOUSE GAS EMISSIONSGREENHOUSE GASESINCOMEINCOME TAXESINTERNATIONAL EMISSIONSLEVEL OF EMISSIONSMARGINAL EMISSIONSNATIONAL EMISSIONSNATURAL GASOILOIL PRODUCERSPER CAPITA INCOMEPERMIT PRICEPETROLEUMPETROLEUM PRODUCTSPRICE OF COALPRICE OF ELECTRICITYPRICE VOLATILITYQUANTITATIVE EMISSIONRENEWABLE PORTFOLIO STANDARDSSEA LEVELSSEQUESTRATION ACTIVITIESTAX CREDITSTAX LAWSTAX MEASURESTAX POLICIESTAX POLICYTAX RATETAX REVENUESTAX SYSTEMTRADABLE PERMITVALUE ADDED TAXWorld Bank10.1596/11147