The role of carbon tax in the integration of environmental economy and green economy in Indonesia

Resty Abdillah Paryanda; M. Agus Alfiyan Nur  Ahmada; Cindy Wakhidatul Maqfiroh

doi:10.99999/pssj.v6i3.1324

The role of carbon tax in the integration of environmental economy and green economy in Indonesia

Resty Abdillah Paryanda , M. Agus Alfiyan Nur Ahmada , Cindy Wakhidatul Maqfiroh

DOI: https://doi.org/10.99999/pssj.v6i3.1324

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📄 Published: 31 Mar 2026

Abstract

Indonesia's rapid economic growth over the past two decades has had a significant impact on the increase of greenhouse gas (GHG) emissions, creating an urgency to integrate environmental dimensions into national economic policies. This study aims to analyze the role of carbon taxes as an instrument connecting environmental economics and the green economy framework in Indonesia. The method used is descriptive quantitative combined with policy analysis, allowing for the mapping of carbon emission conditions, energy structure, and the evaluation of carbon tax implementation in the context of sustainable development. Secondary data were obtained from BPS, KLHK, the Ministry of Energy and Mineral Resources, as well as official policy documents related to carbon taxes and green fiscal measures. Research results show that the energy sector remains the main contributor to GHG emissions, with a high dependence on coal, resulting in relatively high carbon intensity. The initial imposition of a carbon tax rate of IDR 30,000 per ton of CO₂e provides only a limited price signal in driving changes in industrial behavior. Integrative analysis confirms that carbon taxes have strategic potential to promote green investment, energy efficiency, and structural transformation towards a low-carbon economy. However, their effectiveness depends on progressive policy design, institutional readiness, and fair revenue allocation. Compared to the current situation, the implementation of a carbon tax still faces socio economic and technical challenges, including a limited MRV system and the potential regressive impact on low income households.

Keywords: carbon tax environmental economics green economy ghg emissions

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Issue Vol. 6 No. 3 (2026): March 2026

Section Articles

Published 31-03-2026

License

This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite

Paryanda, R. A., Ahmada, M. A. A. N. ., & Maqfiroh, C. W. (2026). The role of carbon tax in the integration of environmental economy and green economy in Indonesia. Priviet Social Sciences Journal, 6(3), 644–653. https://doi.org/10.99999/pssj.v6i3.1324

About the Contributors

Resty Abdillah Paryanda

Pascasarjana, Universitas Islam Negeri Sayyid Ali Rahmatullah Tulungagung

Indonesia

Resty Abdillah Paryanda is a master’s student in the Sharia Economics Study Program at the State Islamic University Sayyid Ali Rahmatullah Tulungagung. Her academic interests focus on sharia economics, Islamic finance, and sustainable economic development, particularly the integration of sharia values into economic policies and practices. She is actively involved in academic research and scientific writing.

M. Agus Alfiyan Nur Ahmada

Pascasarjana, Universitas Islam Negeri Sayyid Ali Rahmatullah Tulungagung

Indonesia

Agus Alfiyan Nur Ahmada is a master’s student in the Sharia Economics Study Program at the State Islamic University Sayyid Ali Rahmatullah Tulungagung. His academic interests include sharia economics, public policy analysis, and institutional studies of Islamic economics, with a focus on strengthening equitable and inclusive Islamic economic systems.

Cindy Wakhidatul Maqfiroh

Pascasarjana, Universitas Islam Negeri Sayyid Ali Rahmatullah Tulungagung

Indonesia

Cindy Wakhidatul Maqfiroh is a master’s student in the Sharia Economics Study Program at the State Islamic University Sayyid Ali Rahmatullah Tulungagung. Her academic interests lie in sharia economics, Islamic finance, and sustainable economic development. She is actively engaged in data processing, academic writing, and the preparation of research articles in accordance with scholarly publication standards.