‘B.C.’s carbon tax is looking like a winner’

THE VICTORIA TIMES COLONIST – 29/07/2010

Amidst increasingly limited prospects for government action on climate change, this article highlights the unique success of British Columbia’s climate policy path since its introduction of North America’s first carbon tax shift. Though initially met by a host of concerns relating to business competitiveness and potentially adverse distributional impacts, a preliminary assessment of the tax two years’ on suggests it seems to be working. The tax puts a price on carbon emissions and then returns the revenues as tax cuts for individuals and businesses. Initial results indicate that B.C’s economic growth in 2009 – the first full year with the tax in effect – was higher than Canada’s national rate, and that unemployment rates are below the national average and did not increase following implementation of the tax. During 2008 and 2009, the tax raised $846 million. The value of the offsetting cuts was nearly $1.1 billion over these two years, such that the net tax reduction for tax payers was approximately $230. While the economic effects have been negligible, the environmental impacts are anticipated to be positive, but it is too early to determine the greenhouse gas reduction as yet, in part because Canada has not yet released carbon emissions data for 2009 and in part because the tax is still relatively low. There are however many examples illustrating that people have used less oil, gas and coal as the prices have risen. Read the article…

‘Climate change ‘taxes’ pushing up energy bills’

THE SCOTSMAN – 18/07/2010

This article suggests that households are paying £84 a year in ‘hidden taxes’ on their energy bills as a result of government environmental policies such as the EU Emissions Trading Scheme, the Carbon Emissions Reduction Target, the Community Energy Saving Programme and the Renewables Obligation. It criticises the additional levies that will result from policies launched under the previous government, which it says are expected to add a further 6% in levies over the next decade, and raises particular concerns about the implications of these levies for fuel poor households. Whilst the article highlights the need to grasp the longer-term implications of these levies – that is, that ‘the only way household energy bills are going is up’ – it does not seem to consider the climate change impacts that would result without them. Read the article…

Taxation trends in the European Union

EUROSTAT – 28/06/2010

This publication by Eurostat compiles tax indicators in a harmonised framework based on the European System of Accounts, allowing accurate comparison of the tax systems and tax policies between EU member states. The report highlights that currently one euro out of every fourteen in revenue is raised from environmental taxes. As a percentage of GDP, environmental tax revenues have been slowly declining since 2004, particularly in the euro area. This trend continued in 2008 and has recently been applying also to the majority of new Member states. Read the main results…

‘India taxes coal to fund clean energy’

THE SYDNEY MORNING HERALD – 02/07/2010

Indian Environment Minister, Jairam Ramesh, has highlighted that the newly introduced levy on coal producers in India could raise 25 billion rupees ($633 million) in its first year, and presented it as the ‘first step to introduce a carbon tax’. Mr Ramesh commends India as leading the way with a domestic carbon tax, whilst others – including the European Union, South Korea and Japan – are still debating it. Coal will be taxed at 50 rupees per tonne with the aim of using the revenue to fund clean-energy projects. Read the article…

Similarly, The Times of India highlights Mumbai’s plans to levy a green tax for proposals requiring environmental clearance. According to an official from the state department, ‘the decision has been prompted by the fact that the proponents of such projects need to be charged to subsidise the cost that has to be incurred on conserving the environment that is under serious threat due to increase in developmental activity’. For example, the Maharashtra Coastal Zone Management Authority (MCZMA) has decided to charge project proponents a one-time cost for the creation of the Coast Conservation Fund. Read the article…

‘Green energy levy would add £20 to bills’

THE TIMES ONLINE – 31/05/2010

This article highlights opposition to Treasury proposals to introduce a levy on power suppliers, conveying the argument that such a levy could add £10-£20 to a typical household’s annual electricity bill as suppliers pass on the cost to consumers. The revenue raised would, however, contribute to the proposed Green Investment Bank, enabling investment in green power projects. Read the article…

‘Carbon tax is preferable to VAT hike’

THE TELEGRAPH – 13/05/2010

This blog entry, by Jeremy Warner, argues that a carbon tax would be politically more acceptable than a VAT hike. Warner points to surveys highlighting a reasonable level of public support for green taxes on the basis of their environmental credentials, and suggests they could raise significant revenue, even allowing for long-term behaviour change. He also suggests that a carbon tax could serve to remove ‘much of the awkwardness around the nuclear power debate’; as fossil fuels become more expensive with the introduction of green taxes, nuclear power may become more commercially viable. Read the blog entry…

‘Academics urge radical new approach to climate change’

THE BBC – 11/05/2010

A group of 14 academics from Europe, North America and Japan have produced a report, the Hartwell Paper, arguing that climate change can best be ameliorated by pursuing ‘politically attractive and relentlessly pragmatic options that also curb emissions’. They highlight that the failure of the UN process and the ‘ClimateGate’ issue necessitate a significant reframing of the climate change issue. One of the authors, Mike Hulme, writes ‘climate change has been represented as a conventional environmental ‘problem’ that is capable of being ‘solved’. It is neither of these. Yet this framing has locked the world into the rigid agenda that brought us to the dead end of Kyoto, with no evidence of any discernable acceleration of decarbonisation whatsoever’. The group advocate an initial focus on short-term fixes for greenhouse gases or other warming agents, such as black carbon, followed by the implementation of a hypothecated carbon tax in developed economies to fund the research, development and roll-out of low carbon energy technologies. Meanwhile, rather than providing new climate adaptation funds to developing countries, all developed countries should be bound to meet the internationally agreed target of contributing 0.7% of their GDP to overseas aid.

Others, such as the German Potsdam Institute for Climate Impact Research, however, argue that ‘the paper’s focus away from CO2 is misguided, short-sighted and probably wrong’.

Read the article…

‘Carbon tax on home fuel comes into force’

IRISH TIMES – 01/05/2010

The Irish carbon tax on domestic heating oil has been implemented, applying to kerosene, natural gas, marked gas oil, liquid petroleum gas and fuel oil. Despite criticisms from business, farming groups and groups campaigning for the elderly, the Irish Government has defended the tax arguing that the revenues raised would be used to reduce taxes in other areas. It is proposed that €40 million will be spent on insulating social housing this year, and a further €90 million allocated to the national home retrofit programme. Read the article…

‘Introduction of carbon tax suggested’

THE IRISH TIMES – 07/09/09

There has been much media coverage of the Irish Commission on Taxation report’s suggestion that a carbon tax should be introduced on sectors not covered by the EU emissions trading scheme. The report suggests ‘the tax should be clearly visible at the point of final consumption to ensure it is not seen as ‘just another tax’’, and highlights that, while there should be no preferential rates, businesses who are involved in the Emissions Trading Scheme should be exempt. The Labour Party spokeswoman on environment and climate change, Joanna Tuffy, said such a carbon tax should only be introduced ‘on the basis that they are fair and that they are genuinely aimed at changing our behaviour as users of energy’. She said she would be ‘very concerned, despite claims that this tax will be revenue neutral, that these taxes will turn out to be merely revenue raising’. Read the article… 

And the report… 

A related article raises concerns about the impact of such a tax on the elderly. While accepting the need for a carbon tax, charity Age Action has argued that the new tax should not be introduced until the necessary measures are in place to protect frail, older people who are already struggling to afford the energy to heat their homes.

‘Lives could be saved with money lost to the ‘green’ air tax’

THE TIMES – 21/08/09

This article highlights the Government’s announcement in April of plans to increase air passenger duty (APD) departure taxes on long-haul flights in the UK by up to 112% next year, and suggests this could have adverse impacts for the work of international charities which fly from the UK to developing countries to provide development aid. The article does not call for charities to be exempt from the APD increases but does suggest the need for a special charity fee that would not significantly cut into a budget that is intended for overseas aid work. Further concerns are raised regarding the spending of the APD revenues, particularly if they are not channelled towards environmental projects; ‘if this is an environmental tax why is the Government not helping the countries that have been the most affected by climate change?’ Read the article…