The way I see it, the major barrier to countries implementing carbon taxes is the fear their economic competitors won’t do the same, therefore hindering their economic growth needlessly. A valid concern.

Why don’t some nations build an ‘opt in’ style Free Trade Agreement that allows any country to join as long as they prove they have implemented and enforced a carbon tax. Those countries then have high financial incentives to only trade within the ‘carbon tax block’ and any country outside is at a serious trade disadvantage.

I’ve (quickly) looked and have not found anything like this proposed (which is frankly crazy).

Would you support your country jumping into this FTA?

What are the unforeseen downsides or objections to a plan like this?

  • MxM111@kbin.social
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    1 year ago

    So, China might make equivalent of FTA, but without carbon taxes. And saying that “our FTA” would tax more if the product originated outside of “our FTA” simply means tariff wars, since the countries outside of our FTA would tax our goods more.

    On top of this, countries have tariffs for reasons, including protecting internal production and revenue collection. Getting into “our FTA” means that they lose those benefits.

    TLDR: It is not that simple, and not clear cut that it will work overall.