What is a good carbon tax? Well a good start would be $100/tonne of CO2.
What does a carbon tax of $100/tonne CO2 (10c/kgCO2) actually mean??
Let's relate it to some other quantities:
Petrol has a 2.3kg of CO2/litre or 10.47kg CO2/gallon
So the tax adds 23c to a litre of petrol or $1.05 to a gallon of 'gas'
Crude oil has a carbon content of 0.43 metric tons CO2/barrel [http://www.epa.gov/grnpower/pubs/calcmeth.htm]. So the tax adds $43 per barrel of oil.
In electricity, the average carbon footprint is around 0.5kg CO2/kWh (0.4kg for gas 1.0kg for coal). So this tax adds 4c/kWh to gas electricity and about 10c/kWh to coal electricity.
How much revenue would this tax gather? If we each emit 20tonnes CO2 (US data) then this would make $2000 per person per year. This money could be spent by the government, used to reduce other taxes or used to reduce the government deficit. If that falls to 10tonnes, there would be $1000 per person per year.
If we say have a £50/tCO2 tax, this would at present make £500 per person, £500x60m=£30,000m=£30bn in total.
By comparison, here are the tax takes in 2006/7 (From http://www.hm-treasury.gov.uk/d/bud08_chapterc.pdf )
Income tax: £147.8bn NIC: £87.3bn VAT: £77.4bn Corporation tax £44.8bn
So a carbon tax at this level could replace approximately 40% of VAT.