Ongoing incentive to abate.
A target-based or technology-based regulation provides no incentive to abate once the target or technology standard is met. By contrast, environmental taxes provide a continuous incentive to abate at all levels of emissions, even after significant abatement has already occurred.
Improves competitiveness of low-emission alternatives. Environmental taxes increase demand for low-emission alternatives, like public transit and cycling in the case of taxes on automotive fuel. This results in economies of scale that help to make such alternatives more viable, without a need for direct subsidies.