Carbon Tax and Revenue Recycling: Revenue, Economic, and Distributional Implications Kyle Pomerleau, Elke Asen 06 Nov 2019 Tax Foundation taxfoundation.org/carbon-tax/
" A carbon tax paired with a lump-sum rebate would increase the tax code's progressivity significantly, but impact employment and output negatively." Key finding #4 [Added here 19 Aug 2021]
" A carbon tax paired with a cut in the employee-side payroll tax increases progressivity, output, and employment." Key finding #5
So let's use most of the carbon tax revenue to lower the payroll tax, with minor portions going towards targeted dividends and clean-energy R&D. Such a use of the revenue would be economically benign--and perhaps politically attractive.
"Finally, some, or all, of the revenue could be used to give money back to Americans."
The word "some" is significant. It indicates that the Citizen's Climate Lobby has some flexibility, and might consider a cut in the payroll tax. Such a move would limit harm to the economy, and could attract more bipartisan support.
More from James Hansen and a co-author. An ideal carbon tax should be environmentally effective, economically positive, and politically attractive. This proposal comes close, but can, perhaps, be made even better.