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Using economic instruments
Using economic instruments to benefit the environment
Green tax reforms and traded permits should be used to encourage people to act in a more environmentally responsible way. We will change the Climate Change Levy into a Carbon Tax, making it more effective at discouraging the use of the polluting fuels and energy sources that harm the environment. We will also strengthen tax incentives to use smaller and less polluting vehicles and create more energy-efficient homes. We will launch a Treasury-led Environmental Incentive Programme, examining tax reforms that will reduce pollution and protect the environment, on the clear principle of taxing differently, not taxing more.