TY - JOUR AU - Metcalf,Gilbert E. TI - Designing A Carbon Tax to Reduce U.S. Greenhouse Gas Emissions JF - National Bureau of Economic Research Working Paper Series VL - No. 14375 PY - 2008 Y2 - October 2008 DO - 10.3386/w14375 UR - http://www.nber.org/papers/w14375 L1 - http://www.nber.org/papers/w14375.pdf N1 - Author contact info: Gilbert E. Metcalf Department of Economics Tufts University Medford, MA 02155 Tel: 617/627-3685 Fax: 617/627-3917 E-Mail: gilbert.metcalf@tufts.edu AB - This article describes a revenue and distributionally neutral approach to reducing U.S. greenhouse gas emissions that uses a carbon tax. The revenue from the carbon tax is used to finance an environmental earned income tax credit designed to be distributionally neutral. The credit is linked to earned income and helps offset the regressivity of the carbon tax. The carbon tax reform proposal is also revenue neutral and avoids conflating carbon policy with debates over the appropriate size of the federal budget. The article provides a distributional analysis of the proposal and also makes a number of political, economic and administrative arguments in favor of a carbon tax and responds to the arguments that have commonly been made against using a tax-based approach to reducing U.S. emissions. ER -