Metroblog

A one-time school project gone terribly, terribly wrong.

20 February 2008

Carbon Tax? Do We Need a Steenking Carbon Tax?

Well why not?

Our provincial government yesterday announced a budget that included a carbon tax. The tax comes in the form of a 2.5¢ tax on fuels. This includes gasoline, other motor fuels and home heating oil.

FSM help me, I think this government finally made a move I can support! They imposed a tax on fuel and lowered personal income taxes for those earning less than $70,000 per year. Which is in fact most of us.

Yet most of the reaction I've heard has been whingeing about the increase in the cost of fuel.

This is silly. Whether or not you believe that global warming is an issue, a consumption tax on the number-one source of airborne pollution in this country is a good idea.

First, I support consumption taxes. Our pandering, poll-sniffing, pols in the federal government recently whorishly dropped the Goods and Services Tax (GST) to encourage people to spend more.

The average Canadian family is $23,000 or so in the hole. It would be one thing if this were for needful items, but most of it is consumer debt, that is, money spent on acquiring crap that they mostly don't need. We didn't need a sales tax reduction, but an income tax reduction wouldn't line the pockets of the conservatives' moneyed interests, or the feds' coffers.

Consumption simply for the sake of consumption has bad effects the world over, and most of those effects don't figure into the cost of consumer goods. In the case of fuel, until now, there has been no accounting for the environmental effects.

When consumption becomes an expensive choice, though, many people will choose to save money. Yes, the rich can afford to continue to consume, but nothing was going to change that anyway.

Second: The tax cut for someone earning the poverty-line $23,000 per year (anywhere in BC but Vancouver, where it's about $50k) is 5 percent off the current rate. The current rate is around 30 percent (probably less, but it's hard to pin down).

So this year you'll get about $400 back. Obviously, the more you earn, the bigger the rebate. At 2.5¢ per litre, you'd have to burn 16,000 litres of fuel to match that $400.

If your car gets 10 km/l (and most get much better mileage) you'd have to drive 160,000 km in a year to burn that rebate. I've owned my car for four years and I've put just over that many kilometres on it.

Now I don't feel this is a perfect plan. I'd rather have seen the income taxes drop a bit less, and have the money stuffed into subsidizing transit. It's hard to argue that someone should ride the bus when the bus simply doesn't get you where you're going, won't get you there in time, or, as in the case of Vancouver, costs five dollars each way to cross the three poorly-laid-out "fare zones". Most Canadians drive to work. Some are driving because they have no choice. We need to make more choices available.

I don't mind the heating fuel rise. Mme Metro and I have managed to argue our way to keeping the heat around 64 Farenheit (about 17 Celsius). My choice would be about 62, but the lady doth protest too much. So we have an automated thermostat that keeps the daytime temperature at 60-62 when we're out of the house or asleep, and at 64 when we're home in the evenings. And hey, it wasn't as though our rates were going down anyway.

In the 1970s, with the spectre of oil shortages and (FSM help us!) gas at 45¢ a litre, the nation adopted stringent measures:
If you're cold, put on a sweater, reduce unneccesary trips in the car, be wise in your use of things like dishwashers and washing machines, etc.

It's time for us to revisit these ideas.

Why? Well:
1)It keeps money in consumers' pockets
2) It reduces waste and extravagance at a time when everyone's $#17ting a brick about $100-a-barrel oil
3) It reduces our environmental footprint
4) It lowers pollution

This carbon tax is only a baby step. But it is, at least, in the right direction.

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8 Comments:

At 9:53 a.m., Blogger Slave to the dogs said...

It depends on what the proceeds of the carbon tax are being used for. If it's SOLELY to eliminate dependence on fossil fuels, then it is in fact a good thing.

But if not, what your government is in fact doing is creating a dependence on gasoline consumption. Are they using it to fund social programs? Guess what...people cut back on gasoline usage, those social programs suffer.

It's the same reason a cigarette tax is a bad idea.

 
At 10:29 a.m., Blogger Metro said...

Actually, cigarette taxes are a great idea. In Ontario, smoke taxes pay for roughly 80% of the extra care smokers need and receive over their lifetimes, and another 3¢ would cover the rest.

Yet another argument for the single-payer system. Convinced yet? :-)

Though as I said, I'd like to see a harder push for public transit. The government says the income tax cut/gas tax combination is "revenue neutral". That sounds as though you may be right. On the other hand, this government has cut so close to the bone anyway that they're meeting stiff resistance. Not to mention that we're in surplus right now, so I think we can afford to take the bet.

Besides, for all the bitching, I doubt it'll make a hell of a lot of difference. 2.5¢ per litre is nothing. The price of fuel rose more than that this week on the news that a Texas refinery blew up. And we get pretty much all our oil from domestic sources!

 
At 12:30 p.m., Blogger Metro said...

Sorry--that was "another 35¢ would cover the rest".

 
At 12:39 p.m., Blogger Slave to the dogs said...

Now, see, THAT sort of cigarette tax makes sense. It doesn't work that way here. They use it to fund health care for underpriveleged children, among other things.

 
At 1:54 p.m., Blogger Metro said...

Whoops--at risk of starting a debate I'd prefer to have elsewhere, let me clarify:

I'm not certain the tax money collected from Ontario smokers is earmarked for their health care particularly.

However, with a single-payer system, it's going into the same wallet (that of the provincial government) that pays for everyone's health care. Thus, smokers are covering much of their cost of care.

I believe the Ontario revenues collected total about 1.6 billion a year, and smoking costs apparently add about 1.9 billion to the Ontario health care expenditures.

They could possibly be spending it on silver-plated jaccuzzis, but I don't think so.

 
At 6:47 p.m., Blogger Slave to the dogs said...

That makes all sorts of sense in a single-payer system, Metro. Hell, even here, I'd say that a disproportionate percentage of Medicaid recipients are also smokers, so it would make sense for add'l cigarette revenues to fund that program.

Here they'd probably use carbon tax proceeds to build more roads.

 
At 7:56 p.m., Anonymous Anonymous said...

I am strongly in favor of increased transit use. Unfortunately, for me to use it it would take 2 hrs in the morning and 1.5 hours after work. In good weather I can ride my bike in less time. I would have to be out waiting for the bus at 4 a.m. to get to work on time a 6 a.m. There is no bus service at 4 a.m.! The ever repeating cycle is when the transit service loses money they cut services and increase fares.
Instead of making it more efficient and cost friendly to consumers they are actually encouraging (and sometimes forcing) people to drive instead. Example : If I wanted to go down the street to the local mega-mall it would cost me $5.00 there and back not to mention the wait time and the ride through the surrounding neighborhoods. If I take my car it takes about 7-8 minutes and costs $.75 in fuel. Also, I don't have to stand out in -50 deg. waiting.
What I am in favor of is a national Air-Care system. A sniffer test every year for ALL vehicles. A gas guzzler tax charged at purchase AND every year at insurance renewal on vehicles that don't meet fuel efficiency standards.
When fuel prices go up most consumers demand better mileage from their cars and thats where they spend their money when buying. This forces manufacturers to produce better, cleaner cars or lose that customer.
The same applies to industry. If they continue using old worn out pollution belching machinery they should also be required to register those vehicles and pay a penalty every year.
In Europe the governments there offer huge rebates and other incentives like fuel tax refunds to encourage companies to upgrade their equipment. For some unknown reason here they seem to do the exact opposite. Hell, the company I work for has tractors that are older than most 1st year college students. Why? Because they still run and there is no incentive to replace them until they become too dangerous/expensive to run.
So, carbon tax? Bring it on.

IH

 
At 6:52 p.m., Anonymous PJ said...

Anonymous-IH, I understand why transit wouldn't work for you. But your case is unusual. Most people are easily able to take transit every weekday but refuse to do so. As a lifelong transit user, I've stood at bus stops in many cities from Toronto to Calgary to Vancouver and smaller towns in between, weekday mornings, and watched one SUV after another go by, each with only ONE person inside. People find the most ridiculous excuses not to carpool, and cling to their gas-guzzlers while pretending a concern for the environment. It's sickening.

 

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