A comparative study of effectiveness of green taxes in South Africa and developed countries

Abstract

South Africa has been going through a series of political, economic and social changes since 1994. These changes have transformed it into a state that shows increased commitment to sustainable development. Although the country is considered as one of the largest developing country emitters of pollution, the South African government has recognised the need to move towards a low-carbon society. The country’s participation in international climate mitigation bodies has seen its commitment to reduce greenhouse gas (GHG) emissions of 34% by 2020 and 42% by 2025. South Africa has committed to achieve these goals provided that it receives the necessary finance, technology and support from the international community. The major objective of this study was to conduct a comparative analysis of the effectiveness of green taxes in SA and developed countries. Four countries were chosen for the analysis in this study; South Africa, China, the United States and the United Kingdom. The study depends on secondary analysis obtained from published articles, databases and websites providing research on various organisations and government bodies. From my analysis, this study observed that many developed and developing countries have already implemented environmental taxes, and many other countries are considering similar instruments. The findings of this study are that green taxes and environmental taxes in general, are intended to protect the environment. By levying higher taxes on activities and products that harm the environment, businesses are discouraged from developing industries that destroy nature. Based on the findings, this study recommends that South Africa should address the inconsistencies in its policies across various government departments. The study also recommends the need for tax policy reconsideration so as to improve the relevance of environmental and green taxes. However, the study observed that since South Africa is still hampered by the triple constraints of unemployment, poverty and inequality, and in order to address the negative impacts of carbon taxes, it needs to put in place certain mitigation agreements with high pollution emitting companies.