If they have no incentive to change then the tax is too low. A tax that's sufficiently high to offset all the externalities is better than a ban because it gives people more flexibility. If somebody is unusually harmed by a ban they might choose to pay the tax even if it's high. And tax is fungible, so the money can be used to prevent other sources of environmental damage, and the overall outcome is better than if it was banned outright.
Thanks for making this point. I feel like most taxes miss the point of externalities. Taxes used to dissuade an activity should be high enough to matter. I tend to not trust low tax amounts on policies meant to lessen an activity. They “look good” but often they just become a hidden money maker for something else not really designed to make a difference.
