August 15, 2011

TAX WHAT YOU DON'T WANT, NOT WHAT YOU DO:

We have a winner: British Columbia's carbon tax woos sceptics (The Economist, Jul 21st 2011)

DURING Canada's 2008 federal election campaign Stephen Harper, the Conservative prime minister, warned that an opposition promise to introduce a carbon tax would "screw everybody". Partly for that reason, Mr Harper is still the prime minister. But in the same year, the provincial government in British Columbia introduced a carbon tax of its own. Despite the levy, its economy is doing well. What is more, the tax is popular: it is backed by 54%, says a survey in the province by Environics, a pollster. Gordon Campbell, the Liberal premier who introduced the tax, won a provincial election the next year.

When arguing for the carbon tax, Mr Campbell faced the same political obstacles that have stymied such plans elsewhere. Only environmentalists were enthusiastic. Businesses feared it would add to costs and slow the economy. The leftish New Democratic Party (NDP) worried it would hurt the poor. But these fears have proved groundless. "The carbon tax has been good for the environment, good for taxpayers and it hasn't hurt the economy," says Stewart Elgie, a professor of law and economics at the University of Ottawa.

It helped that the law introducing the levy required its proceeds to be recycled back to individuals and companies as cuts in income taxes.


Posted by at August 15, 2011 7:38 AM
  

blog comments powered by Disqus
« THE TORTOISE WAS LOSING EARLY TOO: | Main | RUN, JEB, RUN: »