COP29 Climate Talks: Innovative Levy Proposals to Fund $1 Trillion Annual Climate Finance

The COP29 climate talks in Azerbaijan target a $1 trillion annual climate finance fund. Led by the GSLT and nations like France, they explore levies on shipping, aviation, fossil fuels, financial transactions, wealth, crypto, and plastics to generate essential revenue.

The COP29 climate talks in Azerbaijan are aiming to establish a robust annual climate finance fund of $1 trillion or more to aid economically disadvantaged countries in addressing climate change. A task force, led by France, Barbados, and Kenya, is considering innovative tax solutions to meet this goal.

A leading proposal under negotiation is a levy on shipping; a sector responsible for 3% of global emissions. Governments will deliberate options at an upcoming International Maritime Organization meeting. Suggestions range from a flat $150/ton levy to variable rates supported by various countries.

In the aviation sector, which accounts for 2% of emissions, levies on fuel and luxury tickets are proposed to raise substantial funds. Additionally, new taxes on fossil fuels, financial transactions, and wealth, along with levies on cryptocurrencies and plastic production, are being examined as potential revenue streams for climate finance.

(With inputs from agencies.)