The International Monetary Fund (IMF) has said that energy prices in many countries are wrong because they do not reflect environmental damage, notably climate change, air pollution and various side effects of motor vehicle use such as traffic accidents and congestion.
Whether on energy or any other product, prices should provide consumers with an accurate assessment of the actual costs associated with the product, emphasises the IMF in a new report named “Getting Energy Prices Right: From Principle to Practice”.
A number of countries rely too much on general income, payroll, and consumption taxes for their fiscal objectives, and too little from taxes on energy use. In fact, fiscal policies should be centre stage in getting energy prices to reflect the harmful and environmental side effects associated with energy use, points out the report.
