Are climate change policies fair to vulnerable communities? The impact of British Columbia's carbon tax and Australia's carbon pricing policy on indigenous communities

Bubna-Litic, Karen; Chalifour, Nathalie J.
April 2012
Dalhousie Law Journal;Spring2012, Vol. 35 Issue 1, p127
Academic Journal
This paper compares carbon pricing policies in British Columbia and Australia in order to identify differences between carbon taxes and emissions trading schemes (ETS) from a fairness perspective. We examine how taxes and trading systems impact indigenous communities in both jurisdictions. While the regressivity of carbon pricing is a critical part of any fairness assessment, we argue that socio-economic and cultural factors must also be taken into consideration. We discuss the importance of accompanying carbon pricing with policies that mitigate not only distributional impacts, but also additional impacts. These may be funded by the revenue generated by the policy or by other sources of government revenue. We argue in favour of devoting at least some portion of revenues generated by the instruments to climate change mitigation, versus tax cuts, since vulnerable communities are often disproportionately impacted by climate change. We conclude that carbon pricing policies have the potential to be designed in a way that is fair to indigenous communities. The devil is in the details. Both ETS and carbon taxes have cost implications for disadvantaged groups such as indigenous peoples, but they can both be designed in a way that compensates fairly for these impacts. Ultimately, it is a political choice.


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