How Large Are Global Energy Subsidies?

International Monetary Fund / by David Coady, et al.
http://www.imf.org/external/pubs/cat/longres.aspx?sk=42940.0

This paper provides a comprehensive, updated picture of energy subsidies at the global and regional levels. It focuses on the broad notion of post-tax energy subsidies, which arise when consumer prices are below supply costs plus a tax to reflect environmental damage and an additional tax applied to all consumption goods to raise government revenues. Post-tax energy subsidies are dramatically higher than previously estimated, and are projected to remain high. These subsidies primarily reflect under-pricing from a domestic (rather than global) perspective, so even unilateral price reform is in countries’ own interests. The potential fiscal, environmental and welfare impacts of energy subsidy reform are substantial. [H/T: Environmental Valuation & Cost-Benefit News]

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