The Efforts to Reduce Carbon Emissions for Economic Sector Recovery Through Carbon Tax Regulation from an Islamic Economic Perspective
DOI:
https://doi.org/10.21111/at.v11i1.14206Keywords:
Carbon Tax, Islamic Economics, Environmental Policy, Green Finance, Maqasid al-Shariah, Renewable EnergyAbstract
Climate change and increasing carbon emissions have become critical global concerns, with Indonesia ranking among the world's top carbon emitters. To mitigate environmental degradation, the Indonesian government introduced a carbon tax in 2021 under the Harmonized Tax Law, initially targeting coal-fired power plants and the manufacturing sector. However, Indonesia's carbon tax rate remains one of the lowest globally, raising concerns about its effectiveness in reducing emissions. This study examines the implementation, challenges, and economic implications of carbon taxation in Indonesia while exploring its alignment with Islamic economic principles such as Maqasid al-Shariah and Maslahah. Findings indicate that industrial resistance, lack of enforcement, and economic disparities hinder the tax’s impact. The study suggests integrating progressive taxation models, revenue recycling, and incentives for clean energy investments to enhance effectiveness. By incorporating Islamic finance principles, carbon tax policies can achieve environmental sustainability while ensuring social justice and economic fairness.References
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