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French Environment Minister Outlines Revised Carbon Tax Plan

French Environment Minister Jean-Louis Borloo on Wednesday outlined a revised proposal for a carbon tax on large stationary emitters, following the Constitutional Court’s rejection of the original plan last December. The carbon tax would run until 2013, at which time emitters would start paying for permits under the revised EU Emission Trading Scheme (EU ETS).

The original proposal set out a carbon tax on oil, gas and coal consumption by households and businesses, to be set at €17 (US$24) per tonne of carbon emissions, rising gradually.

The Constitutional Council said the legislation would put an unfair burden on consumers, while more than 1,000 of the largest emitters would be able to avoid it. The law exempted big emitters from power stations to oil refineries and cement works.

The new proposal would addresses this by subjecting industrial installations under the ETS to a carbon tax until 1 January 2013, Borloo said. However, he said, specific measures for certain sensitive sectors will be established to preserve the competitiveness of French companies facing international competition. The new plan keeps the tax at €17 per tonne.

A new bill is expected to be presented to the French parliament soon.



Wonder which approach is best or more acceptable?

1) progressively restrict or ban pollution.

2) have polluters pay for the pollution created over a certain level.

3) apply both over an extended (20++ years) period.

When a country applies strict anti-pollution controls, it will have to restrict (or tax) importation of goods produced in countries without equivalent pollution controls. Otherwise, smart manufacturers will quickly move to where they can pollute at will.

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