Roberta Mann


This article explores the links between energy policy, tax policy and global warming. This article focuses on tax policy, because the emerging consensus among legal scholars favors economic incentives rather than command-and-control regulations for reaching environmental goals, and the Federal income tax has proved an effective delivery system for economic incentives.

After briefly discussing of the science of global warming and the provisions of the Kyoto Protocol on Climate Change, the article reviews the impact of both existing tax law and current proposals for energy legislation on global warming, as well as potential international law consequences of failure to act to curtail global warming. This analysis also includes a discussion of global warming as "tragedy of the commons" issue and reflects on how psychological factors and economic beliefs may affect the public's level of concern about global warming.

Concluding that both present law and current proposals create incentives for continued and increasing use of greenhouse gas emitting fossil fuels, the article outlines a three part strategy for curtailing global warming through tax policy: (1) reducing or eliminating the present law subsidies for fossil fuel use while creating and strengthening incentives for alternative energy generation; (2) imposing a carbon tax; and (3) creating incentives for development of carbon sequestration projects in privately held forests in the United States. The article studies the effectiveness of these proposals by comparing similar proposals in effect in other countries and by considering the classic tax policy goals of equity and efficiency.

The tax system is an appropriate and effective way to encourage businesses to adopt an environmental ethic and take action to reverse global warming. Strong economic, esthetic, and moral arguments support changing our tax system to protect the environment from global warming.

Recommended Citation

Mann, Roberta. “Waiting to Exhale?: Global Warming and Tax Policy.” American University Law Review 51, no.6 (June 2002):1135-1222.