Tag Archives: Green LD

A progressive carbon tax policy to reduce both CO2 and poverty

Not taxing carbon is a bit like trying to reduce smoking without taxing cigarettes.

Raising the cost of carbon with a comprehensive carbon tax on all fossil fuels, collected at the point of production or import, uses market forces to reduce CO2 emissions in a very cost-effective and efficient way. Both energy efficiency and the use of low-CO2 energy are encouraged.

It applies to all sectors, including heating, industry, electricity generation and transport.

Fossil fuel subsidies, for example, tax breaks on the North Sea oil and gas, are a negative carbon tax and should be withdrawn.

If the money raised is paid back as a dividend to all UK residents on an equal-per-head monthly basis, then people with a below-average total carbon footprint (i.e. those for whom the dividend payments exceed the effect of price rises due to the tax) are subsidised by those with above-average footprints. Children can be rated at half the adult rate, which can be added to Child Benefit. The dividend, a form of UBI (Universal Basic Income), makes the policy progressive. Poor people’s limited total spending power means their total carbon footprint is almost always below average, even including increased home heating costs, making them winners; as will nearly all people in fuel poverty. Overall, poverty is reduced.

Posted in Op-eds | Also tagged | 6 Comments
Advert



Recent Comments

  • expats
    I went onto the Daily Express website (reckoning that most support for Sunak's 'National Service' would be from a readership that are right wing and JUST too yo...
  • Peter Hirst
    Scandals are part of our life but we can minimise their effect. One way is to detect them earlier through better transparency and accountability. We have endure...
  • Jack Nicholls
    Thank you Yusuf 😊...
  • Peter Hirst
    The elephant in the room to your blog is inequality. Many of the policies you outline reflect the disastrous levels of inequality that corrupt our society. Many...
  • Peter Hirst
    If Keir Starmer wants a lasting legacy he need look no further than introducing PR for Westminster and English local elections. This would also increase his cha...