The article is about how carbon taxes are meeting with resistance but are needed to combat climate change. Justin Trudeau, the Prime Minister of Canada, faced opposition to his carbon pricing system, which gives provinces the freedom to design their own system and collects proceeds to give to households. Other world leaders, including Emmanuel Macron of France and Rishi Sunak of the UK, are also hesitant about imposing green measures that carry upfront costs for consumers. The Biden administration in the US is pouring taxpayer money into subsidies for clean energy investment, which has economists alarmed. The IMF also warns that the fiscal cost of tackling climate change will be unsustainable without a carbon tax. While there is progress in implementing carbon pricing mechanisms, the impact is still dwarfed by traditional fuel excise duties and fossil fuel subsidies. Economists believe that carbon pricing should be part of a mix of policies. Developing countries should not be expected to bear as high carbon prices as developed countries. China’s emissions trading scheme and the EU’s Carbon Border Adjustment Mechanism are also discussed. The article mentions the Climate Capital section of the Financial Times.
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