Pricing carbon, saving green

While most of the savings would be offset by an increase in the cost of carbon intensive P r i c i n G. c A r B o n :. S A V i n G. G r E E n 7 products, Canadians would be free to tailor their consumption patterns to maximize the income If the entire tax savings and to minimize the impact of the carbon price on their wallets. [...] A revenue neutral carbon price This report The analysis establishes that a carbon price can be revenue neutral, meaning that at the end of shows that with the day government coffers experience neither an increase nor decline with the introduction of the introduction a carbon price. [...] In some of the scenarios analyzed in this report, the overall burden of taxation in Canada is reduced through the application of a carbon price. [...] For example, government could use that revenue to reduce distributional impacts resulting from the imposition of the carbon price or to reduce the productivity impact of the carbon price. [...] In addition, models that examined the impact of investment incentives found them to be among the most effective measures to reduce distortions.21 Although there is a body of evidence to draw from on the impacts of revenue recycling for carbon pricing, past studies in Canada have not reached a consensus on the issue of the double dividend or on optimal revenue recycling schemes.