Ihe report by Jean Pisani-Ferry and Selma Mahfouz on “ the economic implications of climate action » (May 2023) has the merit of not underestimating the efforts to be made in the fight against global warming. If the cost of action is less than that of inaction, it remains high.
The report proposes a capital investment strategy avoiding carbon emissions rather than a decentralized strategy based on a carbon tax. These investments are inherently unequal, because for the same percentage reduction in emissions, the less well-off households must invest, on average, a larger share of their income. This average also hides great heterogeneity within each income class according to modes of transport, heating needs, etc.
In this context, how can these investments be fairly financed? The report proposes a mixed strategy based on both public investment, financed by debt and taxes, and private investment resulting from standards on housing, means of transport… A certain logic commands to help financially households who need it and whose income is too low to make the necessary investments. This is the logic behind MaPrimeRenov’ and the means-tested car conversion bonus.
vehicle weight tax
The electric car illustrates these policy dilemmas. It is now unaffordable for the less well-off, even with public subsidies. But subsidizing the purchase of new vehicles for all financially constrained households would be prohibitively expensive. In addition, it is desirable to keep a “price signal” in order to combine mobility and ecological behavior. Taxation can help.
A significant tax on the weight of vehicles reduces the ecological footprint of production, as well as future electricity consumption. Such a tax on all vehicles, negative on bicycles, would encourage the design and purchase of intermediate vehicles between the electric bicycle and the small urban car. Since the weight of vehicles serves more to reinforce social status than to transport large families, such a tax would reduce inequalities.
However, as the objective must remain an incentive, the yield of the tax and the impact on inequalities would be reduced. There is no miracle tax instrument that alone combines performance, reduction of inequalities and pollution.
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