Key Argument on Carbon Tax

In recent discussions surrounding climate change policy, various scholars have proposed that implementing a carbon tax would create greater incentives for companies to reduce emissions. However, critics argue that such a tax could disproportionately affect lower-income households, who may spend a larger share of their income on energy costs. In a comprehensive analysis, author Jane Doe writes, 'While a carbon tax may incentivize industries to innovate towards greener technologies, one must ask: is the economic burden on the most vulnerable populations worth the potential environmental benefits?' This statement highlights a crucial tension between environmental objectives and economic equity.

The analysis further emphasizes the need for policymakers to consider alternative funding mechanisms that can mitigate the regressive nature of the carbon tax. For example, Doe suggests reinvesting tax revenues into renewable energy projects that directly benefit low-income communities. This solution seeks to balance the need for environmental responsibility with economic fairness.

Based on this passage, which of the following statements best summarizes a key argument presented regarding the carbon tax?