Download or read book The Macroeconomic Effects of Environmental Taxes written by Ms.Jenny Elisabeth Ligthart and published by International Monetary Fund. This book was released on 1998-05-01 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper reviews recent literature on the macroeconomic effects of environmental taxes. It attempts to delineate the conditions under which a cleaner environment is compatible with attaining macroeconomic objectives, such as more employment and economic growth. The analysis reveals that an environmentally motivated fiscal reform—using the revenues from environmental taxes to cut labor taxes—may yield employment and environmental dividends if the tax burden can be shifted to agents outside the labor market, such as capitalists, transfer recipients, and foreigners. A cleaner environment and a higher rate of economic growth go hand in hand if the environment is considered an important public input into production.