Fiscal Policy Reforms for Climate Change

The role of fiscal instruments in supporting action on climate change is increasingly recognized. A number of climate related fiscal instruments have been adopted across the world including taxes or charges on fossil fuel energy, carbon pricing mechanisms, fossil fuel subsidy reforms, fiscal incentives and subsidies for renewable energy. Fiscal policy reforms play an important role in ensuring effective and efficient action on climate change. This briefing paper summarizes recent work carried out on the topic by the Green Fiscal Policy Network, and offers reflections from Network members on how fiscal policy reforms can support action on climate change.