Japan imposes carbon tax

Published: Wednesday 15 December 2004

-- Japan's environment ministry has proposed a new carbon tax to cut carbon dioxide emission and enable the country meet the requirements of Kyoto Protocol, a global treaty to fight climate change. Who will pay how much of the "environment tax" would vary with the kind of fuel. Processors and importers of fuels like gasoline, kerosene and liquefied petroleum gas would be charged us $23.05 yen per tonne of carbon contained in them. Part of this burden is expected to be passed on to the consumers. It is estimated that an average household will now pay about us $28.8 a year on average for its use of electricity, gasoline and other fuel. The government hopes to collect annual revenue of 490 billion yen from the new tax.

"We have incorporated tax reduction measures so that the international competitiveness of the industries is not undermined," environment minister Yuriko Koike said while introducing the new plan. Part of the revenue will also be used to compensate the industries' costs. The main idea behind the new plan is to reduce energy use and increase the use of energy-saving appliances to achieve a four per cent cut in 1990 emission levels. Japan plans to achieve its Kyoto Protocol target of six per cent cuts from 1990 levels by 2012, government officials say. But it is lagging behind at present.

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