Indonesia will implement a carbon tax starting April 1, 2022.
Initially, the tax will be levied on coal-fired power plants (PLTU), with a rate of Rp30,000 or approximately US$2.09 per ton of carbon dioxide equivalent (tCO2e).
According to the Ministry of Energy and Mineral Resources (ESDM), the funds collected from the carbon tax will be used to supplement development funds, mitigate climate change, invest in environmentally friendly initiatives, and provide social assistance programs for low-income communities.
Indonesia's Carbon Tax Rate is Relatively Low
According to World Bank data, by mid-2021, around 35 countries had implemented a carbon tax.
Each country has different tax policies. Finland, for example, applies different tax rates to carbon emissions from vehicles and power plants.
Mexico also sets different tax rates for carbon emissions from oil refining and the aviation industry.
Although they vary in form, carbon taxes globally are generally calculated in US dollars per ton of CO2e.
The following details the carbon tax rates in effect globally according to World Bank data:
* Sweden: US$137 per tCO2e
* Switzerland: US$101 per tCO2e
* Liechtenstein: US$101 per tCO2e
* Finland: US$73 per tCO2e
* Norway: US$69 per tCO2e
* France: US$52 per tCO2e
* Luxembourg: US$40 per tCO2e
* Ireland: US$39 per tCO2e
* Netherlands: US$35 per tCO2e
* Iceland: US$35 per tCO2e
* Canada: US$32 per tCO2e
* Portugal: US$28 per tCO2e
* Denmark: US$28 per tCO2e
* United Kingdom: US$25 per tCO2e
* Slovenia: US$20 per tCO2e
* Spain: US$18 per tCO2e
* Latvia: US$14 per tCO2e
* South Africa: US$9 per tCO2e
* Argentina: US$6 per tCO2e
* Singapore: US$4 per tCO2e
* Mexico: US$3 per tCO2e
* Japan: US$3 per tCO2e
* Estonia: US$2 per tCO2e
* Indonesia: US$2 per tCO2e
In addition to the countries listed above, there are other countries that implement carbon emission control through carbon market policy instruments or emission trading systems (ETS).
Countries that had implemented ETS by 2021 include China, South Korea, New Zealand, several European Union member states, and a number of US states.
(See Also: Global Carbon Emissions Increased in 2021, Highest in History)