This is important news. China to implement a rather low (10 yuan=$1-55A/tonne) carbon tax. Officials say it will be “increased gradually”. The tax is tiny but that it is being planned is most important (and welcome) news. For the most part China is employing quantitative restrictions and direct interventions to limit its rapidly growing emissions. Its switch to include economic instruments shows it has a better understanding of market efficiencies than many Western market economies. Certainly a better understanding than Tony Abbott.
Here’s the official message in China – a bit softer than the Western media report since it suggests “plans to” rather than “will introduce” a carbon tax.
Update: An even morecautious response from a key official – no decision on whether to introduce a carbon tax has yet been taken.