Climate Change and Trade: Taxing Carbon at the Border?

CEPS Paperbacks, 2010

120 Pages Posted: 1 Jun 2010

See all articles by Daniel Gros

Daniel Gros

Centre for European Policy Studies, Brussels; CESifo (Center for Economic Studies and Ifo Institute)

Christian Egenhofer

Centre for European Policy Studies (CEPS)

Noriko Fujiwara

Centre for European Policy Studies (CEPS)

Selen Sarisoy Guerin

Trinity College Dublin

Anton Georgiev

Centre for European Policy Studies (CEPS)

Date Written: May 27, 2010

Abstract

This study analyses the economic and political consequences of introducing a tax on the carbon content of imported goods at EU borders and whether such a tax would be compatible with WTO rules. The major findings are: 1. A CO2 border tax or import tariff would increase global welfare; 2. Such a carbon import tariff can be made to be compatible with WTO rules; 3. There are no insurmountable practical obstacles to introducing such a tariff; 4. The equity concerns of the UNFCCC could be taken into account by rebating the proceeds of the tariff to those countries manifestly unable to shoulder the burden themselves.

Keywords: Tax, Carbon, EU, Tax On The Carbon, EU Borders, WTO, CO2, CO2 Border Tax, Global Welfare, UNFCCC

Suggested Citation

Gros, Daniel and Egenhofer, Christian and Fujiwara, Noriko and Guerin, Selen Sarisoy and Georgiev, Anton, Climate Change and Trade: Taxing Carbon at the Border? (May 27, 2010). CEPS Paperbacks, 2010, Available at SSRN: https://ssrn.com/abstract=1618297

Daniel Gros (Contact Author)

Centre for European Policy Studies, Brussels ( email )

1 Place du Congres
B-1000 Brussels, 1000
Belgium

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Christian Egenhofer

Centre for European Policy Studies (CEPS) ( email )

1 Place du Congres
Brussels, 1000
Belgium

Noriko Fujiwara

Centre for European Policy Studies (CEPS) ( email )

1 Place du Congres
Brussels, 1000
Belgium

Selen Sarisoy Guerin

Trinity College Dublin ( email )

College Green
Dublin 2
Dublin, Co.Dublin
Ireland

Anton Georgiev

Centre for European Policy Studies (CEPS) ( email )

1 Place du Congres
Brussels, 1000
Belgium

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