Carbon Taxes Could Bring Developing Countries a Revenue Boost

Developing countries could generate substantial revenue by transforming existing levies on fuel into carbon taxes, according to a project led by the Organization for Economic Cooperation and Development.

Creating a carbon price could add revenue equivalent to 1% of gross domestic product to these countries, according to a report published Monday by the Taxing Energy to Fund Sustainable Development project.

The OECD initiative aims to help countries meet the triple objectives of decarbonization, domestic revenue mobilization, and access to affordable energy. Carbon pricing, the report argues, “can unlock the power of global financial and capital ...