However, the imposition of carbon tax might have a direct impact on the economy and growth of all countries in that it would be followed by higher CO2 emissions as a result of more production industries and household consumption. Since the aim of carbon tax is to reduce CO2 emissions, it is noted that this will distort economic growth. However, to some extent, this is not the case when the negative impact on economic growth from carbon tax is not obvious for the reason that the tax revenue is incorpo- rated into an economic system to offset economic growth loss. Supporting these results, Löfgren and Nordblom [30], based on a survey conducted in Sweden, suggest that using CO2 tax as an important climate policy will be more politically feasible and legitimate when the focus is given to the climate change problem. Pardhan and Gosh [31] investigated the impact of carbon tax on growth of CO2 emissions in India. They reported that reduction in CO2 emissions is reduced by implementing carbon tax. Oueslati [32] unveiled that impact of carbon tax on CO2 emissions depends upon the magnitude of carbon tax reforms. But Friedman et al. [33] exposed that initially carbon tax reduces CO2 emissions effectively but after a certain level its effect dies out. Bruvoll and Larsen [34] noted that carbon tax significantly improves the environmental quality in Norwegian economy. They exposed that a 3.2% growth of CO2 emissions can be reduced by increase in carbon tax by 1% if all else is same. Surprisingly, Allan et al. [35] exposed that carbon tax revenues are used to meet government expenditures and environmental quality is not improved in Scotland.