[Answered]What is carbon tax? Do you think carbon tax can help in reducing air pollution in India? Suggest some measures to reduce air pollution in India.

A carbon tax is a form of pollution tax imposed on the burning of carbon-based fuels (coal, oil, gas). It is a tax levied on products that are a source of greenhouse gases, primarily fossil fuels. The tax is imposed with the goal of environmental protection to reduce the output of greenhouse gases and carbon dioxide. Research shows that carbon taxes are the most efficient and effective way to curb climate change, with the least adverse effects on the economy.

How can carbon tax help in reducing air pollution?

1. Reduced consumption: As the tax makes using dirty fuels more expensive, it encourages businesses and individuals to reduce consumption and increase energy efficiency. It checks the use of fossil fuel.
2. Increase in use ofalternative energy sources: The alternative energy such as solar, hydro and wind energy are costlier than the fossil fuel energy. The carbon tax on fossil fuel makes the alternative energy competitive to the fossil fuel resulting in more use of alternative clean energy.
3. Revenue: Carbon tax offers social and economic benefits. It increases revenue while simultaneously promoting objectives of climate change policy. The revenue can be used for socio-economic purposes like health and education and also on efforts to reduce pollution. It can make the correct use of fund availability for programmes like afforestation.
4. Better air quality: Carbon tax helps in reducing consumption leading to less emissions. The carbon tax charges a fee based on the carbon emission. So, to reduce the fee, users use less fossil fuel. This will help to protect the environment and ensure good quality air in cities especially cities like Delhi and Kanpur.
5. Meet emission targets: A carbon tax is a step towards helping India meet their voluntary target, to reduce the amount of carbon dioxide released per unit of GDP by 25% from 2005 levels by 2020. It will also help India to reach the committed INDC of 33% by 2030.
6. Clean energy investment: The clean energy tax will help to finance a National Clean Energy Fund (NCEF). All the money raised by the tax can help subsidise environmental programs and clean energy. It will also help India to promote the flagship programmes like International solar Alliance, Start up India and Make in India by reducing use of non renewable fossil fuels.

Issues related to Carbon Tax:

1. Regressive in nature: Carbon tax is inherently regressive as it puts a burden on the poor. The poor in India contribute the least to climate change and face the maximum brunt of carbon tax through rise in prices of various commodities and services.
2. Increased production costs: Imposing carbon tax has a direct effect of increasing the production cost which can seriously hamper our competitiveness in international markets as well as domestic production. Indian exports and small scale industries are affected by increase in input costs.Production may shift to countries with no or lower carbon taxes.
3. Issue of appropriate carbon tax: There is no particular methodology to exactly calculate carbon emission. Thus a higher carbon tax and how much to be levied is subjective and debatable.
4. Irrational: India’s emissions are still very low with only 1.8 tonnes of carbon dioxide emissions per capita (much lower than the world average of 4.2 tonnes). Per capita electricity consumption is half of the world’s average, thus imposing a high carbon tax is not rational.

Measures to reduce air pollution:

1. StrengtheningPublic transport: It is important to strengthen public transport and encourage people to use public transport. The odd-even scheme in case of Delhi should be applied without any exemptions.
2. Reducing emissions: Emphasis should be laid on reducing emissions from thermal power plants and industry by instituting strong emissions standards. Carbon tax should be levied to reduce the consumption and hence emissions.
3. Change in Fuel: The use of less polluting fuel to reduce air pollution should be promoted. Use of low sulphur fuel instead of high sulphur fuel by electric utilities is an example of this method.
4. Stubble burning: Centre must work with states to frame a policy to tackle the issue of stubble burning and air pollution.The available paddy straw can be effectively used in the market for power generation. States can provide markets for buying stubble from other states.
5. Effective implementation: There is a dire need for political will for effective implementation of environmental regulations and ensure coordination among all stakeholders

The cost of administering the carbon tax may be quite expensive reducing its efficiency. But it is an effective way to reduce consumption. An optimum carbon tax is the way forward. Higher carbon tax would be regressive and discriminatory and a lower value would defeat its purpose.