Carbon Tax implementation in South Africa
Date
2020
Authors
Khalek, Rizwana Bibi
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Abstract
In a bid to reduce the impact of global warming and climate change by reducing carbon dioxide and other greenhouse gas (GHG) emissions, governments across the globe are implementing carbon pricing instruments. The two most popular examples of these instruments include a carbon tax and an emissions trading system (ETS).South Africa recently implemented a carbon tax on 1 June 2019. Considering the volatility of the South African economy and an increasing rate in unemployment and poverty, many stakeholders have argued that a carbon tax should not be implemented in South Africa. On the other hand, other stakeholders have realised the significant threats posed by climate change. They have argued that the effective carbon tax rate in South Africa is too low and should be much higher to raise awareness and effectively reduce carbon emissions, and to assist South Africa in meeting its commitments agreed to in the Paris Agreement.1 (National Treasury &South African Revenue Service (SARS), 2019) The aim of this report is to critically evaluate South Africa’s implementation of a carbon tax system and the socio-economic challenges that it faces. The approach will be through a comparative analysis of its carbon tax policy measured against The Carbon Tax Guide (Partnership for Market Readiness (PMR), 2017) and carbon tax implemented in some other countries. ETS will be explored as an alternative to carbon tax, and the revenue that can be generated through carbon pricing instruments and the socio-economic impact thereof will be analysed
Description
A research report submitted to the Faculty of Commerce, Law and Management in partial fulfilment of the requirements for the degree Master of Commerce in the field of Taxation, 2020