A Carbon Taxation Mechanism based on Atmospheric GHG Concentration


[Page updated: 02-July-2024]




The Carbon Taxation Mechanism document focusses on how a CO2 equivalent emissions pricing system would set a Carbon Added Tax (CAT) rate. Applied globally, the CAT rate would be based, in part, on the periodic measurement of atmospheric greenhouse gas (GHG) concentration reflecting progress in achieving a net reduction in CO2 equivalent (CO2e) emissions. It is proposed that emissions, irrespective of source whether direct fossil fuel combustion, land use change or fugitive, be quantified using a 20 year Global Warming Potential Time Horizon.


CAT should not be considered a product tax. With application similar to Value Added Tax (VAT) but based on product - supply chain related GHG emissions, violation of WTO / GATT Articles II:2(a) and III would be avoided to usefully transcend the difficult arguments regarding nationally imposed carbon border taxes.


Ambitiously, CAT revenue raised is proposed to redress both the inequality and underfunding of climate finance as well as mitigating the impact of carbon taxation on the world's poor.


In Context of COP26 and COP27


This Online CTM Publication had particular relevance to the COP26 Climate Change conference. Indeed, the pre-conference mood-music highlighted the urgent need for a radical extension to the Paris Agreement - such an extension is proposed within this document and despite the outcome of COP26 remains relevant.


Opinion remains divided on whether COP26 was a success or failure and rather dependent on the reviewer's criteria. As far as achieving a radical extension to the Paris Agreement, it was a complete failure. Beyond fine words, non-binding pledges and the greatly heralded explicit mention of coal as if it wasn't, until now, a combustible contributor to greenhouse gas (GHG) emissions, the ultimate litmus test is whether the rise of atmospheric GHG concentration begins to slow any time soon and then at what rate. The Carbon Taxation Mechanism addresses this aspect (amongst many others) within the context of Carbon Pricing and its implementation as a Carbon Added Tax embracing an end of supply chain Combustion Tax. It is hoped that, in the intervening year before COP27, meaningful progress will be made towards recognising the incredibly urgent need for a Paris Agreement extension and its formulation based on the CTM proposals as an explicit aim with the UNFCCC National Focal Points as key proponents.




Written within the backdrop of increasing climate instability associated to the rapidly rising levels of atmospheric greenhouse gases despite the Kyoto and subsequent Paris Agreements, it was considered a worthwhile exercise to investigate the underlying circumstances allowing this continuing failure. In part, the answer is that there is no comprehensive globally applied GHG accounting framework to adequately include, what is in effect, emissions trading by unquantifiable emissions outsourcing. Inevitably, the research widened beyond its original GHG accounting scope into a time consuming study embracing many different paths of exploration.


It becomes apparent throughout the study that the failure to rein in greenhouse gas emissions is systemic:


  • by inadequately tackling the issue of emissions outsourcing.
  • by not providing a framework to establish realistic carbon pricing at a truly international level.
  • by allowing the use of underpriced carbon offsets.
  • by the use of an inappropriately long, 100 year Global Warming Potential (GWP) climate metric time horizon for the measurement of both emissions and emission reductions.
  • by not ensuring adequate climate financing.


The research examines each aspect of the perceived deficiencies of the Paris Climate Change Agreement and attempts to counter these within the context of a proposed global Carbon Taxation Mechanism comprising:


  • an annually updated carbon pricing rate based, in part, on both actual and rate of change of atmospheric greenhouse gas accumulation rather than by (Emissions Trading Scheme) market based trading.
  • the pricing of carbon emissions, carbon offsets and loss of carbon sink through land-use change based at the prevailing annually updated carbon rate.
  • a globally applied, level playing field, cross-border Carbon Added Tax rated at the annually updated carbon pricing.
  • a taxation cushion based on Carbon Relief Vouchers priced at the prevailing carbon price to specifically protect those most vunerable from increased fossil-fuel based energy costs.
  • the establishment of Carbon Additionality Schemes to generate Carbon Additionality Certificates for Carbon Offsetting within the Carbon Added Tax system and valued at the prevailing carbon pricing.


Full discussion leading to the CTM proposals may be found within the documents detailed below.


CTM Related Document Details


An summary of the Carbon Taxation Mechanism is provided within a separate document available for free download from the Carbon Added Tax as an Alternative to Controversal Border Taxes webpage.


The full Carbon Taxation Mechanism document is available for free download below.


Author: Dave Ewins

Title: Carbon Taxation Mechanism

Version 1.0

Publish Date: 10th October 2021

Organisation: Silva Elm Ltd

Attribute URL: http://www.silvaelm.com/publications.shtml

Silva Elm Document Format Download : CarbonTaxationMechanism.sed.

PDF Download : CarbonTaxationMechanism.pdf.

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