Skip to main content
  • Experts
  • Events
  • Briefing Book
  • Resources
  • About
  • Contact
  • Support
  • Fiscal Facts
Twitter
Facebook
Logo Site
  • Topics
    • Individual Taxes
    • Business Taxes
    • Federal Budget and Economy
    • State and Local Issues
    • Campaigns, Proposals, and Reforms
  • TaxVox Blog
  • Research & Commentary
  • Laws & Proposals
  • Model Estimates
  • Statistics
  • Features
Brief

Potential Linkages between a U.S. Carbon Tax and the Earned Income Tax Credit

Aparna Mathur, Adele C. Morris
July 31, 2017
Download PDFPrint
Share

Primary tasks

  • Overview(active tab)
  • Full Report

Abstract

This brief summarizes, individually and jointly, an excise tax on carbon and an expansion of EITC benefits to childless workers. We find that although in principle a carbon tax that lowers wages could affect EITC benefits and thus impact low-to-moderate income households, the likely magnitude of the effects is very small. We find that far more important to the distribution of burden is the extent to which the carbon tax passes through to raise retail prices, a decidedly regressive outcome, versus lowering wages, which is distributionally much more neutral.

Research Area

Business Taxes Energy/environmental tax Campaigns, Proposals, and Reforms Fundamental reform proposals
To reuse content from the Tax Policy Center, visit copyright.com, search for the publications, choose from a list of licenses, and complete the transaction.

Meet the Experts

  • Aparna Mathur
  • Adele C. Morris
    Senior Fellow and Policy Director for the Climate and Energy Economics Project
Research report

New Evidence on The Effect of The TCJA On the Housing Market

Robert McClelland, Livia Mucciolo, Safia Sayed
March 30, 2022
  • Donate Today
  • Topics
  • TaxVox Blog
  • Research & Commentary
  • Laws & Proposals
  • Model Estimates
  • Statistics
  • Privacy Policy
  • Newsletters
Twitter
Facebook
  • © Urban Institute, Brookings Institution, and individual authors, 2022.