Computable general equilibrium (CGE) modeling has provided a number of important insights about the interplay between environmental tax policy and the pre-existing tax system. In this paper, we emphasize that a labor market policy of recycling tax revenues from an environmental tax to lower...

The main aim of this article is to discusses theoretical issues regarding the use of carbon taxes in climate policy. The issues include inter alia: the definition of carbon and CO2 taxes, the objectives of these instruments and the tax design (the point at which the tax is levied, tax rates, tax...