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August1991

Canada Federal Carbon Dioxide CO2 Tax

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Thanks, August, for ruining a perfectly good anti-tree-hugger rant.

Pfftt.

Well, I was going to wax poetic on the natural deaths of trees but I worried that you might take it too emotionally.

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It's not a long-term solution like pumping CO2 into oil wells.

Depends on how long term, long term, is. It's not going to stay in the oil wells forever. Nowhere on Earth's surface has been sesmically stable for more than a 50-60k years.

When we pass the buck that far into the future, do we have to pay the interest?

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Welcome to the future.

Quebec will implement Canada's first carbon tax in October, collecting just under one cent a litre from petroleum companies in the province, which will raise about $200 million a year to pay for energy-saving initiatives such as improvements to public transit.

The tax will amount to 0.8 cents on every litre of gas sold in Quebec, and 0.9 cents on each litre of diesel fuel.

CBC

This tax is variable and depends correctly on the source. It applies to natural gas and coal. (Charest missed a chance to apply it to firewood.)

It's interesting that this tax is projected to raise $200 million per year while Charest's tax cut is $950 million. Charest also missed a chance to say that a carbon tax would be revenue neutral.

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Most readers on this forum will dismiss this idea as Quebec, left wing claptrap. They are mistaken. We will see more environmental taxes, permits to pollute and deposits for good behaviour. (Quebec is innovating.) Regulating pollution is a costly and ineffective solution.

For the Right, we must ensure that these taxes don't encourage government to spend more. I have no objection to taxes. I object to government spending.

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Most readers on this forum will dismiss this idea as Quebec, left wing claptrap. They are mistaken. We will see more environmental taxes, permits to pollute and deposits for good behaviour. (Quebec is innovating.) Regulating pollution is a costly and ineffective solution.

For the Right, we must ensure that these taxes don't encourage government to spend more. I have no objection to taxes. I object to government spending.

Carbon tax is the way to go. Revenue neutral (actually, it can SAVE you money if you don't pollute) rather than trying to regulate emissions. If you want to pollute you can, but you've gotta pay for it. Makes a lot of sense...it's too bad most Canadians don't see it that way. All they see is that they have to pay an extra cent for their gas.

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This tax is variable and depends correctly on the source. It applies to natural gas and coal. (Charest missed a chance to apply it to firewood.)
It should be charged directly to the consumer. I heard a quote from someone suggesting that companies should not pass the costs on to the consumer. What duplicious tripe - in order to the tax to be effective it _must_ be passed on the consumer.

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It should be charged directly to the consumer. I heard a quote from someone suggesting that companies should not pass the costs on to the consumer. What duplicious tripe - in order to the tax to be effective it _must_ be passed on the consumer.

I see no difference between the two. I would argue that any cost will ALWAYS be passed onto the consumer...otherwise, why wouldn't the companies be charging consumers less without the tax?

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I see no difference between the two. I would argue that any cost will ALWAYS be passed onto the consumer...otherwise, why wouldn't the companies be charging consumers less without the tax?
It was duplicious to levy the tax and then try to pressure companies to absorb the tax. Consumption and GHGs will not go down simply because the oil companies make lower profits. This kind of politics illustrates that most people are hypocrites when it comes to the environment - they think it is important but not important enough to make personal sacrifices.

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This kind of politics illustrates that most people are hypocrites when it comes to the environment - they think it is important but not important enough to make personal sacrifices.

Absolutely.

This is probably why no federal politician (except maybe Ignatieff) would dare to suggest the idea of a carbon tax. The funny thing is, most people don't realize it won't cost them a cent. Like August1991 said, it's government spending that matters. If the government collects extra taxes from a carbon tax, they will either have to reduce other taxes or else pay down the debt. A carbon tax will not cost people money unless they pollute more than average. I wonder if most Canadians even realize that?

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If the government collects extra taxes from a carbon tax, they will either have to reduce other taxes or else pay down the debt.
There is no such thing as revenue neutral tax because the tax cuts won't go to the same group of people paying more for gas. I found it pretty disturbing to find out that:
According to The Gazette, data for 2003, the most recent available, show that Quebeckers who earn more than $28,090 were 40 per cent of tax filers, but paid 92.7 per cent of the income tax.
This kind of imbalance virtually guarantees that any environmental levy targeted at consumption will hurt a group of people who won't benefit from a tax cut.

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I see no difference between the two. I would argue that any cost will ALWAYS be passed onto the consumer...otherwise, why wouldn't the companies be charging consumers less without the tax?
Only consumers? Shareholders (owners) could also bear the burden. Or even sellers.

Corporate taxes don't really exist since corporations don't pay taxes. Only people pay taxes.

(For some time, I have tried to get my cat to pay my taxes but I haven't succeeded yet. Corporate taxes are like a Cat tax.) And that foolish movie The Corporation only confused the question further. Like typical North American Leftists, the movie's producers confused symbol for reality.

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According to The Gazette, data for 2003, the most recent available, show that Quebeckers who earn more than $28,090 were 40 per cent of tax filers, but paid 92.7 per cent of the income tax.
This kind of imbalance virtually guarantees that any environmental levy targeted at consumption will hurt a group of people who won't benefit from a tax cut.

You think a carbon tax will unfarily hurt the poor? It's hard to benefit the people who don't pay very much tax as it is...unless of course you take that extra tax money and give it to the poor...but I doubt that idea would get much support.

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You think a carbon tax will unfarily hurt the poor? It's hard to benefit the people who don't pay very much tax as it is...unless of course you take that extra tax money and give it to the poor...but I doubt that idea would get much support.
No. I am arguing that the people who benefit from a tax cut are different from those that pay the levy. This means that you cannot argue that environmental levies are 'revenue neutral'. This, in turn, leads to the hypocrisy where people expect others to make sacrifices for their environmental virtue.

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Only consumers? Shareholders (owners) could also bear the burden. Or even sellers.

Corporate taxes don't really exist since corporations don't pay taxes. Only people pay taxes.

(For some time, I have tried to get my cat to pay my taxes but I haven't succeeded yet. Corporate taxes are like a Cat tax.)

Why would the owners want to take the burden?

Let's put it this way...why are oil companies not charging 1 cent less than the currently are? If gas costs $1.20 per litre right now, why aren't oil companies charging $1.19 per litre instead?

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This means that you cannot argue that environmental levies are 'revenue neutral'. This, in turn, leads to the hypocrisy where people expect others to make sacrifices for their environmental virtue.

I am talking about revenue neutral overall. Some people will benefit, and others will pay more, but on average people will not be paying more. The people who will pay more are the people who pollute, if they want to save money, they can reduce the amount that they pollute.

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It was duplicious to levy the tax and then try to pressure companies to absorb the tax. Consumption and GHGs will not go down simply because the oil companies make lower profits. This kind of politics illustrates that most people are hypocrites when it comes to the environment - they think it is important but not important enough to make personal sacrifices.

No government will impose a new tax on individuals, they hide it amongst other things.

Taxing corporations is always a nearly direct tax on individuals, but they don't regard it as such emotionally. Go get 'em bad people that give us paycheques and retirements!

A coward taxes business. August has it right:

Only consumers? Shareholders (owners) could also bear the burden. Or even sellers.

Corporate taxes don't really exist since corporations don't pay taxes. Only people pay taxes.

We will all bare the burden by the reduction in economic consumption. If we all use less, we all have to make less, employ less, then therefore spend less.

In fact, if not managed extremely carefully, increasing consumption taxes can have an immediate negative impact on the economy. This one will. Will it cause a recession? Hopefully not.

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Another thing that Charest fails to realise. Alberta (or rather the more common Norway, North Sea and Gulf Coast suppliers) will just sell that Quebec bound oil to someone else.

Quebec reducing consumption makes oil cheaper elsewhere and drives up consumption on lower fuel prices. This is why a carbon tax is a failed idea in my opinion unless everyone in the world is subject to it.

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In fact, if not managed extremely carefully, increasing consumption taxes can have an immediate negative impact on the economy. This one will. Will it cause a recession? Hopefully not.

How is using less of a scarce resource bad for the economy? Isn't that what economics is all about...getting the most out of scarce resources?

I should also add, less consumption = more savings = more investment = better for the economy.

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How is using less of a scarce resource bad for the economy? Isn't that what economics is all about...getting the most out of scarce resources?

Not really. It's about how to distribute scarce resources.

Let's look at a basic example of someone being negatively affected. Jimmy "Dropout" Jimmioli works at the Esso gas bar in Petite Italia, now under this new tax regime. Fellow Italians decide, "well damn, I'm not paying this extra $.10 a litre, instead I'll buy more pasta to fuel my legs and ride my bike."

Petite Italia now goes from needing 3 gas bars to 2... and Jimmy is out of a job.

That's the basic level, now apply that further up the chain, the pipelines, the tankers, the geo-scientists, the engineers, the admin staff at Esso head office, the independant drillers, refiners, truck drivers, ect. ect..

Then apply that to all the retail workers, car dealers (and producers), home builders, ect. ect., that these people used to spend their money on before getting dismissed.

Then then apply that further down the chain. And on and on.

Using less of anything means someone is out of a job and no longer spending money.

All of this without actually doing anything. Like I said, that Quebec oil will just go elsewhere to be consumed and that other party will make money, Quebec won't.

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Let's look at a basic example of someone being negatively affected. Jimmy "Dropout" Jimmioli works at the Esso gas bar in Petite Italia, now under this new tax regime. Fellow Italians decide, "well damn, I'm not paying this extra $.10 a litre, instead I'll buy more pasta to fuel my legs and ride my bike."

Petite Italia now goes from needing 3 gas bars to 2... and Jimmy is out of a job.

That's the basic level, now apply that further up the chain, the pipelines, the tankers, the geo-scientists, the engineers, the admin staff at Esso head office, the independant drillers, refiners, truck drivers, ect. ect..

Then apply that to all the retail workers, car dealers (and producers), home builders, ect. ect., that these people used to spend their money on before getting dismissed.

Then then apply that further down the chain. And on and on.

Using less of anything means someone is out of a job and no longer spending money.

So, Jimmy Jimmioli gets another job which will benefit society more than pumping gas.

Let's put it this way...do you think that machines taking over human jobs is a bad thing? If not, why not?

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So, Jimmy Jimmioli gets another job which will benefit society more than pumping gas.
Agreed. The pasta maker will have to hire new workers. And the long term value to society of pasta making will be greater than the long term value of petroleum engineers.

With that said, job creation is a very bad way to measure economic (or social) success.

If you need a phrase, a civilized society needs "value-creating jobs". Jobs that rely on abusing the environment (using it for free now but imposing a cost to the future) or jobs that require government subsidy are generally not "value-creating jobs".

100 high-tech, highly-skilled petroleum engineers can create less value than one pasta maker.

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We need a federal carbon tax like we need a hole in the head.

Wow, that was a great argument. I'm sold.

You have no idea how hard I'm laughing right now. Well said gc.

Scary enough, chilli admits to sitting on several CPC boards. I would hate to see the thought-provoking arguments that seep out throughout these meetings.

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Guest chilipeppers

We need a federal carbon tax like we need a hole in the head.

Wow, that was a great argument. I'm sold.

You have no idea how hard I'm laughing right now. Well said gc.

Scary enough, chilli admits to sitting on several CPC boards. I would hate to see the thought-provoking arguments that seep out throughout these meetings.

Not all at one time!

Scary enough it seems that not a lot of anything but personal commentary seeps out of some posters. Have you all not read the rules are what.

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Not all at one time!

Scary enough it seems that not a lot of anything but personal commentary seeps out of some posters. Have you all not read the rules are what.

Why did you break the rules by putting forth such an articulate response such as "we need a carbon-tax like we need a hole in the head"? Was that contributing something to the forum?

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