Environmental taxes and charges can be used to ensure that private firms pay the costs of the environmental damage that they cause. This is supposed to provide an incentive for them to reduce that damage. For example a company that has to pay a charge to put toxic waste into a river may work out that it can save money by treating its wastes before putting them in the river. If it decides not to do this then it has to pay the full charge. In this way the cost of the pollution is incorporated into the price of its products.
Consumers then have the choice of paying the extra.
Alternatively they can buy a different product that is cheaper because it causes less environmental damage. In all these ways, putting a price on the environment is a way of ensuring that the cost of environmental damage is considered by governments, firms and individual consumers when they make their decisions. The decision is still theirs, which is why it is attractive to free market advocates, but the balance has been shifted in favour of the environment. One of the first problems is whether the price the economist puts on the environment reflects its true value. Our society is ignorant of most species that exist, the role they play in their ecosystems, how they interact, and the use or value they might be to humans now and in the future.