The Effects of Hazardous Waste Taxes on Waste Generation and Disposal

In 1990, 31 states levied taxes on the generation or management of hazardous waste. These taxes are one of the broadest applications of emissions taxes in U.S. environmental policy. This paper examines the impacts of the state taxes on chlorinated solvent waste from metal cleaning, using plant-level data from EPAʹs 1987–1990 Toxic Release Inventories. The results suggest that the amount of solvent waste generated may respond elastically to changes in incineration costs. The overall impact of state hazardous waste taxes currently in place in the United States is estimated to be small, however, because the taxes constitute a small fraction of total waste management costs. The results also suggest that the taxes successfully encourage generators to choose treatment over land disposal as their waste management method.