France’s missed rendezvous with carbon-energy taxation

Un article [en anglais] consacré à l'analyse des obstacles cognitifs, techniques et politiques à la mise en œuvre d'une taxe carbone en France et à la présentation de propositions visant à améliorer l'acceptabilité de cet instrument fiscal à la fois environnemental et économique.

Points clés [en anglais] :

Carbon-energy taxation is limited by issues of social and political acceptability
Despite the existing theoretical consensus on the economic and environmental rationales of carbon-energy taxation, its implementation and/ or outcomes are still limited by problems of political and social acceptability. Indeed, many failed carbon-energy taxes initiatives, among which France’s climate-energy contribution, stem from the lack of support of the public and politicians alike: while the former opposes increased taxation as a means to implement climate policy, the latter doubt the effectiveness of the fiscal instrument.

Barriers to an increased acceptance are cognitive, technical and political
The constraints to the effective implementation of carbon-energy taxation are primarily cognitive, as linked to how policy-makers traditionally conceive taxation (budgetary vs. incentive). The low acceptance of carbon-energy taxation is also due to political decisions on the technical design of the instrument: in the case of France, the modalities concerning the tax base and the recycling mechanism agreed on by the government, while aiming at improving its political feasibility, paved the way for neverending debates on equity and fairness and eventually worsened the tax’s social acceptability. Finally, political factors such as administrative conflicts and a poor political marketing played a substantial role in the French project’s low acceptance and final policy failure.

Paths to improve carbon-energy taxation’s acceptability
In order to receive more support for environmental taxes, carbon-energy taxation should be designed and implemented within a global fiscal reform encompassing various aspects, i.e. shifting the tax burden from labour to pollution, removing environmentally harmful subsidies, limiting exemptions, redistributing revenues from high to low income households, and developing public investments in transports and R&D. Disseminating information is also an essential factor in building acceptance. Multi-year consultation processes such as green tax commissions must therefore be implemented so as to achieve a better communication of scientific and technical knowledge.