Sequencing, spending, and symbolism: Low carbon taxes primarily serve purposes other than emissions reduction

Carbon taxation is generally viewed as a central climate policy instrument to decrease and eventually eliminate carbon emissions. In many countries, however, carbon taxes are set and are kept too low to strongly reduce emissions, suggesting that climate change mitigation may not be their primary rationale. We analyze the tax design, policy evolution, and governmental justification of each of the 19 initially low national carbon taxes implemented in 1990–2023. We show that several countries followed a within-policy sequencing rationale: an initially low carbon tax set to increase to emission-reducing levels later, but sometimes slowly, up to decades after implementation. Some taxes were designed to fund other climate policies. Most initially low carbon taxes primarily followed fiscal rationales or were implemented to meet international expectations. We conclude that the primary rationale or priority outcome for enacting carbon taxes is not always to reduce emissions.