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Summary
- A new report suggests implementing a tax on fossil fuel extraction to raise funds for the green transition.
- The proposed tax could raise $900bn by 2030, with 80% allocated to helping developing countries with climate losses and damages.
- While the Climate Damages Tax is seen as innovative, it may face challenges in implementation and effectiveness.
- The proposed tax aims to shift towards sustainable energy and support countries in responding to climate change impacts.
A new report has claimed that a tax on the extraction of fossil fuels could raise $720bn by the end of the decade for to support the green transition in the world’s poorest countries.
Led by Stamp Out Poverty and backed by the likes of Greenpeace, Climate Action Network and Christian Aid, the Climate Damages Tax report, published earlier this week, examines the proposal that OECD countries, in particular members of the G7, should “lead in introducing a fee per tonne of CO2 embedded (CO2e) within the domestic extraction of coal, oil and gas.”
The report outlines that, if introduced in OECD countries in 2024 at a low initial rate of $5 per tonne of CO2e increasing by $5 per tonne each year, the tax would raise a total of $900bn by 2030. This, it says could be split so that 80% ($720bn) went to the newly established Loss and Damage Fund for helping developing countries with in responses to climate losses and damages and 20% ($180bn) was retained by countries for use domestically.
Read the full post at Energy Monitor.
