Petroleum Taxes : Trends in Fuel Taxes (and Subsidies) and the Implications
Recent World Bank analysis shows that taxes on petroleum products are a critical source of government revenue for low-income countries. And if the experience of industrial countries serves as any guide, the rates of these taxes will have to rise sharply as low-income economies develop. But policymakers must be mindful of how taxes (and subsides) affect the relative prices of fuels, since too large a difference in process between products cab lead to fuel switching and adulteration, adversely affecting the government tax take and pollution levels.
Summary: | Recent World Bank analysis shows that
taxes on petroleum products are a critical source of
government revenue for low-income countries. And if the
experience of industrial countries serves as any guide, the
rates of these taxes will have to rise sharply as low-income
economies develop. But policymakers must be mindful of how
taxes (and subsides) affect the relative prices of fuels,
since too large a difference in process between products cab
lead to fuel switching and adulteration, adversely affecting
the government tax take and pollution levels. |
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