Southeast Asia’s Green Economy and Environmental Taxation

Abstract

The purpose of this research is to replicate tax models throughout Southeast Asia by using variable models like
environmental and fuel levies. Based on a regression model generated from Southeast Asia’s energy consumption and
CO2 emissions modified by a 10% extra tax (as a dummy variable), this study aims to establish the notion that Southeast
Asia levies an environmental levy. Southeast Asia might adopt the environmental levies suggested by the European
Union, which served as the impetus for this study. In this study, the log-t approaches are employed to enable the clustering
of nations into new clubs or convergence groups, as well as the application of the test for converging within certain
states of the panel while accounting for the panel data of the variable. In Southeast Asia, environmental fees are, in our
opinion, a crucial instrument for public policy in lowering CO2 emissions and its negative consequences on pollution. In
addition to significantly increasing tax revenues, gas taxes or carbon pollution taxes on the energy and transportation
sectors also have a significant impact on Southeast Asia’s economic growth. A power tax might limit the use of natural gas
or environmentally friendly power and help finance projects that use sustainable energy. The purpose of environmental
taxes in the transportation sector is to both encourage ecologically friendly transportation and lower carbon dioxide emissions
brought on by less eco-friendly public transportation.