We consider a pure exchange economy with consumption exter-

nalities in preferences. We study commodity taxes and lump-sum

transfers schemes, which lead to equilibrium allocations where all in-

dividuals are strictly better off. We extend the result of Geanakop-

los and Polemarchakis (2008) on the generic existence of Pareto im-

proving policies with uniform taxes and equal transfers to general

non-separable preferences, when the number of individuals is strictly

smaller than the number of commodities. We also overcome this limi-

tation by considering either uniform taxes with personalized lump-sum

transfers, or personalized taxes with uniform lump-sum transfers. As

in Geanakoplos and Polemarchakis (2008), we mainly use utility per-

turbations, but we also provide a sufficient condition for ensuring the

existence of Pareto improving policies without perturbing utilities.

Keywords: Consumption externalities, commodity taxes, lump-sum trans-

fers, Pareto improvement.

JEL classification: D50, D60, D62.