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Article

Impact of Carbon Tax Increase on Product Prices in Japan

1
College of Policy Science, Ritsumeikan University, Ibaraki 567-8570, Japan
2
Sustainable Management Promotion Organization (SuMPO), Tokyo 101-0044, Japan
*
Author to whom correspondence should be addressed.
Academic Editors: Magdalena Radulescu and Devinder Mahajan
Energies 2021, 14(7), 1986; https://doi.org/10.3390/en14071986
Received: 19 March 2021 / Revised: 1 April 2021 / Accepted: 1 April 2021 / Published: 2 April 2021
(This article belongs to the Special Issue Energy Policy for a Sustainable Economic Growth)
The introduction or strengthening of a carbon tax is being considered in many countries as an economic policy instrument to reduce greenhouse gas (GHG) emissions. However, there is no study analyzing the impact of a carbon tax increase in a uniform method for various products, reflecting the energy taxes and exemptions. Therefore, this study analyzes the price changes of products associated with the introduction of a stronger carbon tax, using Japan as an example. A process-based life cycle assessment database was used to enable a detailed product-level analysis. Five scenarios with different taxation amounts and methods were analyzed. The results show that price changes vary greatly by industry sector and product, even within the same industry sector. For example, seasonal vegetables and recycled plastics are less affected by carbon tax increases. Imported products, such as primary aluminum, are not affected by the Japanese carbon tax change, indicating a risk of carbon leakage. If GHGs other than CO2 are also taxed, the price of CH4 and N2O emitting products, such as rice and beef, would rise significantly. The method presented in this paper enables companies to assume price changes in procured products due to carbon taxes and policymakers to analyze the impact of such taxes on products. View Full-Text
Keywords: carbon pricing; energy tax; product price; life cycle assessment (LCA); tax exemption; greenhouse gas (GHG); recycling; carbon leakage carbon pricing; energy tax; product price; life cycle assessment (LCA); tax exemption; greenhouse gas (GHG); recycling; carbon leakage
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MDPI and ACS Style

Nakano, K.; Yamagishi, K. Impact of Carbon Tax Increase on Product Prices in Japan. Energies 2021, 14, 1986. https://doi.org/10.3390/en14071986

AMA Style

Nakano K, Yamagishi K. Impact of Carbon Tax Increase on Product Prices in Japan. Energies. 2021; 14(7):1986. https://doi.org/10.3390/en14071986

Chicago/Turabian Style

Nakano, Katsuyuki, and Ken Yamagishi. 2021. "Impact of Carbon Tax Increase on Product Prices in Japan" Energies 14, no. 7: 1986. https://doi.org/10.3390/en14071986

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