Tax crypto and plastic to pay for climate, development, leaders urge

BAKU: Plastics and cryptocurrencies could be taxed like flying and fossil fuels to plug the gap in climate finance and help developing countries, according to a task force led by France, Kenya and Barbados.

The three countries believe that hundreds of billions of dollars could be generated from “Global Solidarity Levies” on the most polluting industries to help developing countries.

Barbados Prime Minister Mia Mottley, an influential advocate for climate action, told the UN’s COP29 climate talks in Azerbaijan that the time had come “to consider levies”. “Between maritime, airlines and fossil fuels, we are comfortably in the vicinity of about $350 billion a year, and this will go substantially on top of the public money,” she insisted.

“Large parts of the economy pollute the planet but contribute little to public finances, development and climate mitigation,” said the task force’s report released in Baku.

Its experts floated core levies on private jet fuel, frequent flyers, windfall fossil fuel profits, shipping and stocks and bonds and derivatives.

Taxes on cryptocurrencies, plastics and the super-rich are also proposed, the latter idea pushed by Brazil during its G20 presidency.

The experts estimate that $5.2 billion could be raised from a levy on cryptocurrencies because of “the high energy demand of crypto mining”, a move which they argue could also reduce emissions.

The report also said that a tax on crypto transactions could raise “tens of billions a year”.

The contribution that the plastics industry may have to make comes as UN talks on the world’s first treaty on plastic pollution take place in Busan, South Korea later this month.

“The levy would be intended as a source of finance to support developing countries with action to combat plastics pollution,” the experts said, and could raise $25 to $35 billion a year.

As well as France, Kenya and Barbados, the 17-member coalition behind the task force includes the EU and the African Union, with Brazil signalling that it too will join.