Thanks for your reply. That makes sense. So it's based on competition of the suppliers and if one particular supplier decreases pollution output by spending big dollars then their tax penalty will be reduced and after they recover the costs they can reduce the cost to consumers. Then the public will be impressed and be very supportive of that supplier, hence the competitors will be forced to do the same thing. Just hope the polluters don't combine and choose not to do anything and as their taxes go up so does the cost to consumers and so does the payments from the government. I think I would rather see the government simply give the polluters some form of concession for money they spend on developing and installing pollution control systems. That way costs to consumers would not need to be increased and the government would not have to spend time and money on distributions to households.
