WE ALL KINOW WHERE WE'RE HEADED...:

Is This How You Cut Greenhouse Gas Emissions Without Hurting The Economy? (Ben Schiller, 8/21/13, Co.Exist)

Ask economists what to do about climate change, and some will say a carbon tax is the best solution. But that doesn't mean there are carbon taxes everywhere. Just the opposite. Governments have tended to go with options that are easier politically, like subsidizing cleantech industries, if they've gone for anything at all.

British Columbia is an exception. In 2008, it introduced a tax on about three-quarters of the fossil fuels consumed in the province, gradually raising the level year-by-year. By mid-2012, it was charging $30 U.S. dollars per ton of carbon dioxide. That means drivers now pay about seven cents a liter more for gas than they did five years ago.
"It is possible to have both a healthier environment and a strong economy--by taxing pollution and lowering income taxes."

The result? Appreciably lower fossil fuel consumption. A study by Stewart Elgie, at the University of Ottawa, finds that fuel use per person dropped 17.4% by 2012, and 18.8% compared to the rest of Canada, where fuel consumption actually rose a bit. This reduction, in turn, has allowed B.C. to lower its emissions by 10% over the period--a pretty good dent in its greenhouse gas emissions reduction target of 33% (compared to 2007 levels) by 2020.

The really good news is that B.C. appears to have achieved this without hurting its economy. Economic output per person, while negative, was better than in other provinces. And taxes are now lower overall. B.C. reinvested the carbon tax income to reduce its personal and corporate tax rates (its income taxes are now the lowest in the country). In fact, it managed to give out more than it took in: about $500 million more, according to the study.

Taxing what you don't want instead of what you do ain't exactly rocket science.

Posted by Orrin Judd at August 21, 2013 12:00 PM
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