Carbon taxes have been frequently advocated as a cost-effective instrument for reducing emissions. However, in the
practice of environmental policies, only six countries have implemented taxes based on the carbon content of the
energy products. In this paper, we evaluate carbon taxes with regard to their competitiveness, distributional and
environmental impacts. The evidence shows that carbon taxes may be an interesting policy option and that their main
negative impacts may be compensated through the design of the tax and the use of the generated fiscal revenues