Discussion about introducing an eco tax has a long history, at least in Germany. Since the early nineties, the Member States of the European Union have struggled
to find a compromise as to what a harmonised solution could look like. Up to now, we still await an answer.
At the beginning of the debate, eco taxes had quite a good reputation in society as the instrument was "labelled" with the possibility of gaining a double dividend, which means that through the introduction not only can emissions be reduced, but positive employment effects can also be achieved. Research has clearly shown that the latter depends on how the revenues are recycled.
From an economic perspective the continuing debate about environmental taxes, particularly in connection with climate protection, essentially revolves around two questions:
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