Policy measures to respond to carbon fee impacts on industry in Taiwan

This study investigates the potential implications of introducing a carbon fee in Taiwan on its industries and formulates strategies to enhance the system’s acceptance, effectiveness and sustainability. It entails an extensive review of pertinent international experiences with carbon pricing instruments (CPIs), an analysis of measures that address potential adverse impacts on industry, and the development of tailored recommendations for Taiwan.

The study first analyses CPIs and measures to respond to industry resistance in similar economies. This involves a review of the most relevant international experiences with CPIs in Section 2 and a thorough analysis of selected measures used in other jurisdictions in Section 3. In Section 4, the study assesses potential for opposition and competitiveness risks within Taiwan’s context. By examining Taiwan’s carbon-intensive industries, international trade flows, vulnerable groups/regions and specific sectors, the study aims to anticipate and understand potential challenges and areas of concern. Finally, Section 5 develops recommendations on policy options for Taiwan. These recommendations draw from academic insights, international experiences and best practices in carbon pricing. They aim to address the concerns raised by industries and stakeholders while preserving the effectiveness of the carbon fee in reducing emissions and promoting a low-carbon transition.