Carbon taxes
“Stop taxing work and start taxing the pollution that destroys our planet.”
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2. How does it fit with Compass’ core beliefs of equality, solidarity, democracy, freedom, sustainability and well being?
The British economy would become more sustainable and receive a much-needed shove in the direction of reducing packaging, unnecessary air transport and clocking up road miles. By taxing carbon, the cleanest forms of behaviour are encouraged.
The money raised could be used to increase the tax-free allowance for PAYE, helping some of the poorest in society, improving equality and making work pay. At the same time, the green economy would be given a shot in the arm, creating jobs and wealth to allow Britain to create well-being in a responsible and sustainable way.
3. How does it build the institutions of social democracy, like social groups and collective and cooperative forms of ownership and control?
Local communities would work together to establish how they could optimise their behaviour in a carbon-reducing way. Industry, transport and consumer groups would need to cooperate in order to reach consensus on the new preferences of arranging labour, capital and goods.
4. How much will it cost or raise and where will any cost come from?
Initial administration costs in calculating the carbon content of activities would need to be borne by the HM Revenue & Customs budget. However, once established, the revenue generated by the Carbon Tax should be negated almost exactly by the reduction in Income Tax.
5. Which groups in the electorate are likely to support or oppose this measure? Is there any polling evidence you have on this?
The aviation industry is likely to oppose, as are other big polluters. Those most likely to support the measure are those who would benefit from the income tax reduction.
6. Is there a place or country where it’s worked? Please provide some information.
Unknown, although Sweden has made progress in the area.
7. What are the three main arguments in favour/against it?
In favour:
1) Reduces pollution and enhances sustainability
2) Improves equality
3) Improves healthcare, both in air quality in the UK (prolonging life) but also could slow down global warming, which affects developing countries disproportionately.
Against:
1) Carbon cost could be distorting if incorrectly calculated
2) Adherence / compliance could be difficult to monitor
3) Longer-term, the Carbon Tax would need to increase as polluting behaviour reduced, or else tax revenue would be reduced
The lorry drivers revolt over fuel shows that there will be SEVERE opposition to this proposal. The proposal - or something like it - is essential but the politics are toxic.
One approach would be to relabel it as, perhaps, Climate Fairness and reflect this in what we do with the money.
The essential elements would be:
- Tax carbon emissions, ie fuels but also those from agriculture. (Sustainability)
- Tax imports from countries without such schemes to provide a level playing field. (Fairness)
- Pay, from this tax, every resident a benefit. The level would be enough to cover the extra costs faced by the poorest 10%. (Well-being.) The rest of us will just have to change.
- Use the rest of the tax to pay for climate mitigation and adaptation. (Sustainability)
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