France announces new tax scheme in a bid to improve air quality

The French government has announced that it intends to tax big polluters on their CO2 emissions until January 2013, Reuters reported.

Under the proposals, heavily polluting companies will have to pay for their emissions permits until a new EU-wide carbon trading scheme begins in three years time.

Power plants and some factories will primarily be the sectors affected by the new bill.

Government spokesperson Luc Chatel told the news provider that there will also be help for companies that perform well.

"The principle is to include these companies in a system of reward and punishment. The reward could be compensation through tax credits," he explained.

France is the first major economy to attempt to bring in a carbon emissions tax, according to the news service.

The EU introduced its carbon emissions trading scheme in 2005, using a cap and trade system.

Now in its second trading period, which runs until the end of 2012, the 27 member states along with three other countries in the European Economic Area have signed up to the initiative.

Posted by Lauren Steadman