AN IMPLEMENTATION FOR THE FUTURE OF MOTOR VEHICLE TAX IN THE SHADOW OF THE PARIS CLIMATE SUMMIT: THE EXAMPLE OF TÜRKİYE

Türkiye is committed to lowering its greenhouse gas emissions, adhering to the terms of the Paris Climate Agreement, which it has endorsed. In this context, there is significant interest in environmental tax reform that merges carbon regulation with the reduction of other distorting taxes. This study assesses the effects of motor vehicle tax (MVT), energy consumption, and economic growth on Türkiye’s carbon footprint from 1995 to 2020, framed by the Environmental Kuznets Curve (EKC). Utilizing the ARDL technique, a method for analyzing time series data, the research reveals that the EKC hypothesis does not apply. Additionally, the study finds that MVT, as an included variable in the EKC model, does not significantly influence the carbon footprint. It is crucial to acknowledge that all variables in the model interact and collectively influence the analysis of variable relationships. As a result, crafting policy recommendations on this matter requires a comprehensive, multidisciplinary approach. Therefore, adjusting and implementing MVT in a manner consistent with the objectives of the Paris Climate Agreement could serve as a pivotal strategy for advancing both Türkiye’s economic and environmental goals.