Carbon Taxation for International Maritime Fuels: Assessing the Options

40 Pages Posted: 16 Oct 2018

See all articles by Ian Parry

Ian Parry

International Monetary Fund (IMF)

Dirk Heine

Erasmus University Rotterdam (EUR) - Rotterdam Institute of Law and Economics; University of Hamburg - Institute of Law and Economics; University of Bologna - Department of Economics; World Bank, Macroeconomics, Trade and Investment Global Practice

Kelley Kizzier

World Bank

Tristan Smith

University College London

Date Written: September 2018

Abstract

The International Maritime Organization (IMO) announced in April 2018 a target of cutting greenhouse gas (GHG) emissions from the sector by 50 percent below 2008 levels by 2050 and subsequent meetings of the IMO will develop a strategy for making headway on this commitment. This paper seeks to inform dialogue about the possibility of a carbon tax as a key element of GHG mitigation policy for international maritime transport. The paper discusses the case for the tax over alternative mitigation instruments, options for the practical design issues, and then presents estimates of the impacts of carbon taxation and other instruments from an analytical model of the maritime sector.

Keywords: Greenhouse gas emissions, Environmental taxes, Climatic changes, Environmental policy, Maritime emissions, climate mitigation, carbon tax, revenue-neutral feebate, design issues, spreadsheet model, International Marime Organization, Environmental Economics: Government Policy

JEL Classification: Q54, Q58, H23

Suggested Citation

Parry, Ian and Heine, Dirk and Kizzier, Kelley and Smith, Tristan, Carbon Taxation for International Maritime Fuels: Assessing the Options (September 2018). IMF Working Paper No. 18/203. Available at SSRN: https://ssrn.com/abstract=3267230

Ian Parry (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Dirk Heine

Erasmus University Rotterdam (EUR) - Rotterdam Institute of Law and Economics ( email )

Burgemeester Oudlaan 50
PO box 1738
Rotterdam, 3000 DR
Netherlands

University of Hamburg - Institute of Law and Economics ( email )

Johnsallee 35
Hamburg, 20148
Germany

University of Bologna - Department of Economics ( email )

Strada Maggiore 45
Bologna, 40125
Italy

World Bank, Macroeconomics, Trade and Investment Global Practice ( email )

1818 H Street, NW
Washington, DC 20433
United States

Kelley Kizzier

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Tristan Smith

University College London ( email )

Gower Street
London, WC1E 6BT
United Kingdom

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