Taxing Luxury Emissions

58 Pages Posted: 14 Mar 2023 Last revised: 12 May 2023

See all articles by Clint Wallace

Clint Wallace

University of South Carolina School of Law

Shelley Welton

University of Pennsylvania Carey Law School

Date Written: March 10, 2023


A host of recent economic and sociological studies have documented the rising challenge of carbon inequality — that is, extreme class disparities in carbon emissions both within the United States and globally. These studies show an alarming divide, with the top 10% of emitters producing half of all emissions and the top 1% alone producing 17% of emissions, while the bottom 50% of the world produces only 10%. These disparities are driven by “luxury emissions” produced by the carbon-intensive lifestyles of the rich, which too often include private jets, mega-SUVs, yachts, and multiple mansions.

Climate change law has been slow to react to the reality of carbon emissions inequality — even as public and media outrage has mounted. Perhaps discouraged by decades of slow progress on both wealth redistribution and carbon consumption policy, policymakers and legal scholars have yet to put forward any serious proposals for how the law might, or should, account for class-based emissions disparities.

This Article builds the case for embracing efforts to parse luxury and non-luxury emissions in climate policy design. Luxury carbon is, we assert, distinguishable on multiple salient grounds, including morally, socially, and politically. In a world facing a grave need to parsimoniously consume our remaining “carbon budget” to avoid catastrophic warming, carbon-intense luxury consumption is condemnable in ways that the quotidian — and often structurally constrained — consumption choices of the masses are not. Luxury consumption also drives broader consumption patterns through social dynamics that multiply the effects of policies to regulate high-end emissions, while also potentially activating class politics to build supportive political coalitions. After drawing out these distinctions, we explore how to design a carbon tax to target luxury emissions, considering potential tax bases, rates, and revenue uses. We thus provide a blueprint to spark debate and discussion around how the law might appropriately account for pernicious class divisions in climate culpability.

Keywords: luxury emissions, carbon tax, climate change, climate justice

Suggested Citation

Wallace, Clint and Welton, Shelley, Taxing Luxury Emissions (March 10, 2023). U of Penn, Inst for Law & Econ Research Paper No. 23-27, Cornell Law Review, Forthcoming, Available at SSRN: or

Clint Wallace

University of South Carolina School of Law ( email )

1525 Senate Street
Columbia, SC 29208
United States

Shelley Welton (Contact Author)

University of Pennsylvania Carey Law School ( email )

3501 Sansom Street
Philadelphia, PA 19104
United States

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