A study on environmental tax for environmentally friendly products

The paper proposes an environmental taxation scheme using LCA, which can provide consumers with an incentive to choose vehicles with lower CO₂ emissions. This taxation scheme has two major measures : life cycle CO ₂ emissions, and life cycle cost, considered not only in the utilisation phase but also in the manufacturing phase. The authors figure out the tax rate 28.05 yen/kg-CO₂, which makes the hybrid electric vehicle's life cycle cost less than that of conventional gasoline vehicles, and is near the existing gasoline tax rates in Japan and Europe. The LCC of EVs becomes more effective with longer driving distances or a long life-time, with this taxation. When the lifetime distances is short at certain level, LCC of GVs are better than that of CEVs because of high CO₂ emission level in the manufacturing phase. The proposed tax system enables consumers themselves to choose the best option of CEVs, depending on their specific needs such as lifetime driving distance and lifetime use.