Pollution tax can drive green transformation in Bangladesh

Despite its low per capita greenhouse gas emissions of 1.29 tonnes of CO2 equivalent—well below the global average of 4.58 tonnes—Bangladesh faces significant environmental challenges due to inefficient technologies causing high levels of pollution. To address this, the government is considering a pollution tax on environmentally damaging sectors to generate revenue, which can be reinvested to reduce pollution and promote sustainability.

Currently, Bangladesh imposes an environmental surcharge on owners of multiple vehicles. Expanding this to a comprehensive pollution tax policy could help transform key polluting sectors such as brick kilns, household cooking, waste management, power generation, and industrial effluents.

Bangladesh’s economic growth has been impressive, with GDP growing over 5.75% in the last two fiscal years. However, pollution from sectors like brick kilns and power generation hampers development and impacts public health. The World Bank’s 2023 analysis showed that GDP fell by 17.6% in 2019 due to pollution-related factors, highlighting the need for green initiatives.

Brick kilns, which are predominantly coal-fired and inefficient, are a major source of air pollution. With over 7,000 kilns operating in Bangladesh, their GHG emissions are expected to reach 23.98 million tonnes of CO2 equivalent by 2030. While the government has pushed for cleaner technologies, progress has been slow.

Indoor air pollution from solid fuel cooking in rural areas is another concern. Although efforts are underway to deploy improved cooking stoves, more support is needed to transition to electric or gas cooking.

Poor waste management, open waste burning, and industrial effluents also pose serious health and environmental risks. Implementing better waste management practices and waste-to-energy projects can help mitigate these issues.

A pollution tax could be an effective tool to drive green transformation. For instance, imposing a small emission charge on traditional brick production could generate substantial revenue, which could be used to subsidize cleaner technologies. A tax of Taka 0.5 per brick could yield Tk 13.5 billion annually, encouraging a shift towards eco-friendly brick-making.

Revenue from pollution taxes could also support initiatives such as improved cooking stoves and clean energy projects. Regulating industrial water pollution through fines and enforcing effluent treatment requirements would further help protect water bodies.

As Bangladesh aims to become a developed nation by 2041, adopting strong measures to curb pollution is crucial. A pollution tax, starting with the brick kiln sector, could serve as an effective pilot to generate revenue for greening the economy and fostering sustainable growth.

-Financial Express