Research looks at how environmental taxes can work for everyone, in Spain and beyond

Governments that impose taxes on carbon dioxide and other greenhouse gas emissions can benefit from a cleaner, more climate-friendly environment and a revenue stream that can be tapped to lower other taxes and create jobs. But environmental taxes may also exact an excessive financial burden on low-income households, which spend a much greater fraction of their budgets than richer households do on heating oil, natural gas, and electricity. This concern has limited the use of green taxes in Spain, where emissions are taxed at levels far below average for the European Union, which seeks to lower emissions across the continent to fulfill its 2015 Paris Agreement climate pledge.

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