Cutting Emissions Through Fossil Fuel Subsidy Reform and Taxation

This report uses the Global Subsidies Initiative – Integrated Fiscal Model (GSI-IF model) to analyze the potential for greenhouse gas (GHG) emission reductions and fiscal savings across 32 countries through fossil fuel subsidy reform (FFSR) and fossil energy taxation by 2030.

• Fossil fuel subsidy reform (FFSR) alone can lead to a simple country average reduction in GHG emissions of approximately 6% by 2030 compared to business as usual, with some modeled countries achieving reductions as high as 35%. Cumulative GHG emissions abated from FFSR by 2030 are estimated at 5.4 gigatonnes of carbon dioxide equivalent (GtCO2e), which is comparable to the annual emissions of 3.8 billion cars or 1,000 coal-fired power plants.
• Combining FFSR with a 10% fossil energy tax and the reinvestment of 30% of subsidy savings and tax revenues into renewable energy and energy efficiency would nearly double the average GHG emission reductions to 11.8% by 2030.
• FFSR is projected to generate cumulative fiscal savings of nearly USD 3 trillion across the analyzed countries by 2030. On average, governments save USD 546.47 for every tonne of CO2e removed through FFSR alone; if resources are reallocated via a subsidy swap, governments can increase emission reductions while still saving USD 164 per tonne of CO2e removed.

APA

Gass,, J. K. B. (2021). Cutting Emissions Through Fossil Fuel Subsidy Reform and Taxation. International Institute for Sustainable Development. https://www.iisd.org/publications/cutting-emissions-fossil-fuel-subsidies-taxation

Chicago

Gass,, Jonas Kuehl,Andrea Bassi,Philip. Cutting Emissions Through Fossil Fuel Subsidy Reform and Taxation. International Institute for Sustainable Development, 2021. https://www.iisd.org/publications/cutting-emissions-fossil-fuel-subsidies-taxation.

Wikipedia

{{cite report |last1=Gass, |first1=Jonas Kuehl,Andrea Bassi,Philip |title=Cutting Emissions Through Fossil Fuel Subsidy Reform and Taxation |publisher=International Institute for Sustainable Development |date=4 July 2021 |url=https://www.iisd.org/publications/cutting-emissions-fossil-fuel-subsidies-taxation |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{gass2021cutting, author = {Gass,, Jonas Kuehl,Andrea Bassi,Philip}, title = {{Cutting Emissions Through Fossil Fuel Subsidy Reform and Taxation}}, institution = {International Institute for Sustainable Development}, year = {2021}, month = jul, url = {https://www.iisd.org/publications/cutting-emissions-fossil-fuel-subsidies-taxation}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }