The Global Carbon Tax: Too Little, Too Late?

April 21st, 2025

Sophia Amundgaard

11,000 natural disasters, 2 million deaths, and 3.64 trillion dollars later, the world has—for the first time in history—united its action against global warming… or attempted to.

In 2023, the UN-led International Maritime Organization (IMO) established the binding “2023 IMO Strategy” with the goal of achieving net-zero greenhouse gas emissions by 2050 within the shipping industry, including a commitment to reducing emissions by a 40% benchmark by 2030. In accordance with this objective, its Marine Environment Protection Committee, composed of IMO member states omitting the US, met earlier this April to monetize its 2023 strategy into the first world-wide carbon tax—an extension of carbon pricing which puts a fiscal value on the carbon content of fossil fuels.

IMO Secretary-General Arsenio Dominguez characterized the organization's actions as critically “[setting] the course for a net-zero future for the maritime sector”.

Unfortunately, achieving such a task will be an uphill battle. In 2024, a record 37.4 billion tonnes of carbon dioxide was released into the atmosphere, 3% of which was tied directly to international maritime shipping. Additionally, in 2024, only one fifth of global emissions were covered by a pricing program. More concerningly, a mere 1% were priced high enough in accordance with the Paris Agreement’s annual temperature target. In fact, the average carbon cost in 2021 was $3 per ton, falling dangerously below the $75 estimated value imperative to encapsulating warming below 2°C.

At the forefront of negotiations is the ever present cost of renewable adaptation, which could amount to over $73 trillion in upfront investments and upwards of $300 billion in annual maintenance. For the developing world, amounting to an over 19% GDP value. In the long-run, an environmentally conscious transition could save the global economy 57.1% of its energy needs and 60% of their costs. Nonetheless, with the global economy set for its “weakest half-decade performance” in 2025, debates surrounding monetary practicality have remained central.

Proposed solutions have included the introduction of an alternative climate levy and green fuel standard which would broaden the impact of carbon pricing to include other fossil fuel contributors and inflate economies of sale. The Clean Shipping Coalition Environmental Defense Fund were pioneers for the proposal, additionally urging reform of the IMO’s carbon intensity metric.

But money isn’t the only concern, considering temporal efficacy has also been pertinent. 85-95% of modern ships still reliably consume heavy fuel, shaping demands for ‘true’ decarbonization as a fundamental shift in marine fuels cumulatively. Global Maritime Forum decarbonization leader Jesse Fahnestock argues that the accumulation of e-fuel supply investment based on renewable electricity will be a long process, scaling upwards of half a century.

Concludingly, numerous proposals were drafted during the 5-day summit. A coalition of 62 countries now support a uniform levy on carbon emissions. This initiative has also garnered support from the shipping industry. In fact, The International Chamber of Shipping—representing more than 80 percent of the world’s merchant fleet—endorsed carbon pricing mechanisms for maritime emissions. Resultantly, under the leadership of the Pacific island nations and Belize, a $150 per ton carbon levy remained the “most ambitious proposal on the table.”

Contrastingly, opposition embodied by Saudi Arabia, China, Brazil, and 12 others submitted profound opposition in late January, lobbying for credit trading: capitally rewarding emissions below a set cap while enabling credit purchasing for violators. They wrote, “2030 is less than 5 years away and as a matter of scientific, engineering and technical reality it will not be possible to reduce emissions beyond 6% within that time frame for all ships, leading to unnecessary penalization that will result in significant impacts on trade, food and energy security and our beloved sector.”

Even still, Ambassador Albon Ishoda, Marshall Islands’ special envoy for maritime decarbonization, asserted that anything short of a universal levy would widen trade gaps and enable wealthy corporations to maintain their practices, deeming a resolution “meaningless” in its absence.

Although IMO protocol aims for consensus, the summit concluded with a 63-16 vote with 24 abstaining nations. Shockingly, the Pacific Island nations were among the refrained, claiming they were forgoing participation in a policy that would “do too little, too late to cut shipping emissions and protect their islands”.

The draft agreement is set to formally be adopted in October, entering into effect in late 2027/early 2028. Under its framework, vessels will incur charges proportionate to their greenhouse gas emissions in a compromise with the levy system. Ships operating with fossil-based bunker fuels will be subject to a base fee of $380 in addition to a surcharge of $100 for each ton of emissions that exceeds a designated threshold.

If fortified, the shipping industry will be the first subject to an international binding emissions target. Its ratification is estimated to lower emissions by 8% by 2030 and generate roughly $10 billion in revenue annually to funnel into green energy initiatives.

In a time when disputes regarding global trade abound, a successfully concentrated focus on the shipping industry—anticipated to contract downwards of 1.5% in 2025—could save 74 million lives by 2100.

But as always, the question remains: are we too little, too late?

Extemp Analysis by Sophia Amundgaard

Q: Is globally united climate change action too late to be impactful?

Substructure: This question can be difficult but likely falls under expectation verification/evaluation (EVV) substructure. Point to point, we’ll be arguing that unilateral action, in one capacity, would or would not be able to have a large impact (net positive or net negative). We’ll start by defining the status quo of that determining factor in the form of something that needs to occur then analyze how unilateral action does or does not fulfill that.

A - Current issue/task that needs resolution

B - whether or not unilateral action can achieve that goal

Q: Is globally united climate change action too late to be impactful?

Answer-wise, this question is somewhat flexible. It will be pertinent to define the word "impactful" as a value. Personally, I’d lean towards answering no and quantifying impact as a humanitarian value (saving 74 million lives by 2100.) Also, saving that quantity of lives implies that in some capacity, something is being done to better the status quo, or at least not worsen it… which is inherently impactful. This is also likely the answer judges want to hear.

AGD: There are plenty of jokes to be made regarding climate change. Even joking about the summit itself, possibly regarding abstinence from the Pacific island nations could be effective. Additionally, to put a name to the issue, heart stories—if they are genuine—can be extraordinarily impactful here. I would heavily suggest staying topical though.

Background: What makes the question relevant is the IMO summit, so we’ll want to reference it in the background and likely in a point itself, including it as a major theme but not zeroing in on it entirely. Prior to that, it’s crucial to focus on past failures due to a lack of unilateral action, and for that we’re going to want to bring in evidence regarding the Paris Agreement or case studies from countries like Brazil. Even just mentioning acts like the Inflation Reduction Act in the US can be extremely beneficial depending on the points being made.