Some may see environmental taxes as ‘paying for the right to pollute’, and this
may effectively be the case if they are set too low. Ideally, authorities should support
forms of taxation which discourage environmental damage, rather than punishing
bodies which commit it. The reality is that developing countries may find fair and
effective taxation a challenge for a number of reasons: limited funding for
monitoring and enforcement; a pressing need to provide employment, even if it
means some environmental damage; limited infrastructure, which hinders
inspections; vulnerability to pressures from powerful companies and financial
interest groups; and the potential for corruption. Any country can be tempted to
argue that development is necessary for strategic reasons – and use it to side-step
controls like taxation