Determinants of carbon tax acceptance in Malaysia: The influence of public awareness, perceived effectiveness and environmental attitudes

Abstract

Public acceptance is a critical factor in the successful implementation of environmental taxation policies, as insufficient public support may undermine their effectiveness in achieving emission reduction objectives. Among these policy instruments, carbon tax has gained considerable global attention as an important mechanism for mitigating climate change. In Malaysia, however, a comprehensive carbon pricing system has yet to be implemented, resulting in limited accountability for greenhouse gas emissions and weaker incentives for industries to reduce their environmental impact. Public acceptance of carbon tax varies across countries and is influenced by a range of economic and non-economic factors. This study examines three non-economic determinants of carbon tax acceptance in Malaysia: public awareness, perceived effectiveness, and environmental attitude. Drawing upon Heider’s Attribution Theory, the study explains how individuals interpret environmental issues and policy measures and how these interpretations influence their acceptance of carbon taxation. Using survey data collected from 391 respondents, statistical analyses were conducted to examine the proposed relationships. The findings reveal that public awareness, perceived effectiveness, and environmental attitude all have significant positive effects on carbon tax acceptance. These results provide valuable insights for policymakers seeking to enhance public awareness, improve communication regarding the benefits of carbon taxation, and strengthen transparency in environmental governance. The study contributes to a better understanding of the social and psychological factors that influence public acceptance of carbon tax and offers practical implications for the design and implementation of future environmental taxation policies in Malaysia.