"US currently accounts for about 18 per cent of global CO2 emissions which is projected to decline to about 15 per cent by 2035 as emissions in other countries rise. Growing economies like China and India should reduce their intake of carbon emission," the Congressional Budget Office said in a report on the policy implications of enacting a carbon tax.
The report notes that global efforts to reduce carbon emissions have fallen short.
Some of the leakages could be addressed through policies, such as tariffs that would impose the same costs on imports of emission-intensive goods that a carbon tax would impose on US goods. However, practical and legal challenges to such policies could limit their effectiveness, CBO said.
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Addressing the same concerns through a carbon tax would entail providing such producers with a tax rebate that was linked to their output.
A group of US lawmakers in a letter to Congressman Ed Whitfield, Chairman Subcommittee on Energy and Power and Committee on Energy and Commerce has said CBO's conclusions about the costly impacts of climate change are consistent with recent reports released by the United Nations Development Programme (UNDP) and the World Economic Forum.
Despite this, chronic pollution and vulnerability to natural disasters continue to plague many of these countries.
UNDP concluded that failing to address climate change human development progress in the world's poorest countries would come to a halt or even reverse.
The World Economic Forum's annual global risks report report released in January 2013 found that in next 10 years rising greenhouse gas emissions poses one of the biggest global risks and that failure to adapt to climate change could have a tremendous socioeconomic impact across the globe, it said.