Wednesday, June 18, 2008

federal Liberals outline carbon tax

Dion has rolled out a solid policy in the form of a $10 per tonne of "greenhouse gas emissions" tax, gradually increasing to $40. The Liberals are swearing the tax will be revenue neutral, meaning the bottom income bracket may drop a point and a half to 13.5%, with the middle and upper middle brackets down a point each to 21% and 25%. Better yet, there should be some reduction in the corporate rate.

Whether the consumption of carbon is that much more environmentally threatening than the consumption of Twinkies, I'm not sure, but that ultimately doesn't matter: government has to raise revenue somehow, and taxing consumption is more efficient than taxing income.

But wouldn't there be a disproportionate impact on Alberta?

Jack Mintz says he is "not sure".

It's my understanding that the tax is on consumers, not producers, and is such is about as Alberta friendly as one can get. Followers of this blog will recall from my notes of mid-March that Stelmach is pushing carbon capture, and Enbridge CEO Pat Daniel estimates that carbon capture would cost on the order of $80 to $100 per tonne of emissions. So who is really looking out for Alberta industry?

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