A new OECD report finds that transferring a third of the additional revenues from carbon pricing reforms to poor households, by means of an income-tested cash transfer, would reduce energy affordability risks by more than 10% on average across the 20 countries considered in the report.
‘Higher energy taxes are a good tool to avert catastrophic climate risks and curb air pollution,’ said Pascal Saint-Amans, director of the OECD’s centre for tax policy and administration. Carbon pricing reforms that cut CO2 emissions mean higher energy prices, but ‘good policy design and the wise use of the additional revenues raised can help improve energy affordability for vulnerable households’, Saint-Amans added.
A new OECD report finds that transferring a third of the additional revenues from carbon pricing reforms to poor households, by means of an income-tested cash transfer, would reduce energy affordability risks by more than 10% on average across the 20 countries considered in the report.
‘Higher energy taxes are a good tool to avert catastrophic climate risks and curb air pollution,’ said Pascal Saint-Amans, director of the OECD’s centre for tax policy and administration. Carbon pricing reforms that cut CO2 emissions mean higher energy prices, but ‘good policy design and the wise use of the additional revenues raised can help improve energy affordability for vulnerable households’, Saint-Amans added.
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