Can tax combat pollution? : an assessment of the Sri Lankan rubber industry
Date
2008
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SANDEE, Kathmandu, NP
Abstract
Rubber processing in Sri Lanka is one of the most polluting industrial activities in the country, and, the current ‘command and control’ system of pollution control is proving to be ineffective. Now, a new SANDEE research suggests that taxation could be used to encourage the industry to clean up its act. // The SANDEE study recommends that the government should levy a tax equivalent to 8.6 per cent of the total annual turnover of the rubber industry. It argues that this would provide an incentive for the rubber industry to meet environmental standards. Such an economic instrument would also motivate the Sri Lankan Central Environmental Authority to monitor effluents more carefully, and that would give polluting firms an incentive to find innovative ways of dealing with their waste, such as recycling the chemicals in their effluents.
Description
This policy brief is based on SANDEE working paper no. 30-08, "Taxing pollution : a case for reducing the environmental impacts of rubber production in Sri Lanka"
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Policy Brief
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Keywords
RUBBER INDUSTRY, WATER POLLUTION, CHEMICAL POLLUTION, POLLUTER PAYS PRINCIPLE, TAXATION, SRI LANKA