find that employment and welfare always increase when the revenue from the introduction of a Pigouvian tax (imposed on … firms and households) is fully recycled to cut the rate of the pre-existing labour tax. Moreover, it turns out that the … case in which the pollution tax is positive at the outset. …

This paper focuses on the relationship between tax reforms and environmental quality in Italy. First, we analyse some … of the characteristics of the tax system. Within a dynamic model, we estimate the marginal distortion introduced by … possible tax reforms, keeping into account both the effect on utility and the impact on pollution. Finally, we design a tax …