Determinants of Environmental Taxes in America through a Panel Data Model: Period 2010-2020

Abstract

This study examines how 25 countries in the Americas responded to climate change and environmental degradation between 2010 and 2020 through the implementation of green taxes. The objective is to employ an econometric panel data model to identify key variables associated with environmental tax revenues and thereby determine the revenue potential in each country. The results reveal that the Americas lag the European Union in environmental tax collection, indicating the need for more effective fiscal policies. Countries like Argentina exhibit low levels of environmental taxation, while Mexico achieved significant success in increasing its green taxes. The model also demonstrates a positive correlation between the Human Development Index (HDI) and GDP per capita concerning environmental taxes, as well as a negative correlation between the Index of Productive Capacities (IPC) and CO2 emissions. In conclusion, this study emphasizes the importance of enhancing environmental fiscal policies in the Americas to promote sustainable development and responsible environmental management.