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Carbon tax cannot be addl source of climate finance: Pranab

Carbon tax cannot be addl source of climate finance: Pranab
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First Published: Sat, Oct 15 2011. 08 06 PM IST

File photo
File photo
Updated: Sat, Oct 15 2011. 08 06 PM IST
Paris: India on Saturday strongly opposed imposition of carbon tax as an additional source of funding to fight climate change.
“India believes that some of the measures like carbon export optimization tax and levy on CDM/offsets violate the principles of the Convention (UNFCCC) as their incidence falls entirely on developing countries and these cannot be recognized as a source of new and additional finance for climate change,” Finance Minister Pranab Mukherjee said here.
File photo
He was making an intervention at the G20 Finance Ministers’ and Central Bank Governors’ meeting on Development, Climate and Innovative Financing.
He said global levies on carbon emissions from shipping and aviation should be raised only if a mechanism for refund of revenues collected from developing countries in put in place.
The refund should not be treated as climate change finance flow or a contribution of developing countries to global revenue mobilization envisaged under the UNFCCC, he said.
“We also feel that the flow of finance leveraged by international finance institutions (IFIs) or the multilateral development banks (MDBs) should be counted towards the overall target only if there is a net additional infusion of capital by the developed countries to the capital base of the MDBs/IFIs,” he said.
Mukherjee said the grant or concessional portion of the loans advanced by MDBs on the basis of such new capital only should be counted as new and additional finance for climate change.
Mukherjee further said the exchange of information for tax purposes would be complete only after the due taxes are recovered from the assets located in a foreign jurisdiction.
“Thus, the assistance in collection of taxes should also be part of the International Standards of Transparency and Exchange of Information for Tax Purposes,” he said.
On the problems like certain corporate resorting to unfair means to lower tax liability, the Indian Finance Minister asked G-20 “to call to the United Nations... for developing internationally agreed guidelines on transfer pricing and international taxation”.
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First Published: Sat, Oct 15 2011. 08 06 PM IST