A new study has found out that the use of carbon tax revenue to fund free green electricity and public transport has better effects in reducing individual households’ greenhouse gas emissions than any other method. University of Leeds researchers found out these free services will reduce home energy emissions by 13.4%. These services will also reduce motor fuel emissions by 23.8%.
Carbon taxes on home energy and motor fuel caused a burden on low-income households as every taxpayer pays the same tax, regardless of their income. Though the low-income households contribute much less to climate change.
The researchers found out that providing free green services is a more effective than redistributing the tax revenue among the population of the states.
The researchers have studied data of 275,614 households across 27 European countries. The data has helped the researchers to estimate the annual greenhouse gas emissions for home energy and motor fuels per household.
They have also found out that giving cash back through tax rebates is not a very effective idea as it brings very small reduction in the emission of home energy and motor fuel.
But universal green vouchers have resulted in reducing home energy emissions by 13.4% and by introducing renewable electricity generation and public transport have reduced motor fuel emissions by 23.8%.