The carbon tax is an important step to sustain our clean, green and liveable environment, and to help Singapore transform into a low-carbon economy.
The Minister for Finance announced at Budget 2017 our plans to introduce a carbon tax from 2019. The tax will be applied on facilities that emit 25,000 tCO2e or more of greenhouse gas (GHG) emissions annually and cover the six GHGs1 that we currently report to the UNFCCC as part of our national GHG inventory.
To give the industry more time to adjust and implement energy efficiency projects, the tax will start at $5/tCO2e in the first instance, from 2019 to 2023. The Government will review the tax rate by 2023. We intend to increase the tax to between $10/tCO2e and $15/tCO2e by 2030. In doing so, we will take into account international climate change developments, the progress of our emissions mitigation efforts, and our economic competitiveness. The first payment of the carbon tax will be in 2020, based on emissions in calendar year 2019.
Role of carbon tax in Singapore’s mitigation strategy (Click to download a larger image)
1 The six GHGs that will be covered under the carbon tax are: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulphur hexafluoride (SF6).