Question

The use of petroleum products is thought to be one of the lead causes of pollution and climate change. One main use of petroleum products is as fuel for cars and other forms of transport. Discuss the pros and cons of taxing petrol to reduce pollution.

Answer 1

BENEFITS OF PETROL TAX-

1. BETTERMENT OF TECHNOLOGY-due to increase in tax on petrol the automobile sector would conduct research on electrical cars and promote the nature effective energy in long term.
2. PROMOTION AND INTRODUCTION OF GREEN ENERGY-alternative to petrol car would be introduce which is electrical and bio-fuel.this would be very beneficial in long term.
3. INNOVATIVE AND EFFECTIVE MECHANISM-innovative and effective mechanism of production has started.companies like Tesla and other counties have started the production of cars which runs on electrical energy.
4. COST EFFECTIVE IN LONG TERM-in long run it would be very cost effective.decreasing harmful chemical contents in the environment and increased efficiency in technology would impact the future generation positively.
5. BETTER SOCIAL CONTRIBUTION-when the environment is pure and less polluted it would increase the life span of people and life expectancy of people and diseases caused by the pollutants would also decline which would be a social contribution.

LIMITATION OF PETROL TAX-

1. SHORT RUN ADVERSE IMPACT ON PEOPLE-increased duty would increase the prices of petrol and in short run it would impact adversely to the middle class and lower class due to increased transportation cost,industry would also increases its good prices and ultimately it would be paid off by the general public.
2. COSTLY ALTERNATIVES- there are several companies who have started the production of electrical car,but this is beyond the reach in terms of cost to the most of the middle class families.therefore the options to petrol cars are very costly in present.