(PROGRESS) Green Taxes

Is this eco-idea working too well?
Green taxes 'are making billions'

Brits are paying a tax that cuts their pollution, gives the planet's ecosystem a chance to recover, and fills the public treasury to full. Is that a problem? Some businesses think so. But the solution need not mean reducing the tax; it could mean: share the revenue; just like businesses pay dividends, so could government.

BBC International, 3 September 2007

The Taxpayers' Alliance says some businesses are suffering unfairly. The government is raising billions of pounds more in green taxes than it needs to remove the UK's "carbon footprint", a report says.
The Taxpayers' Alliance said emissions in 2005 had done damage worth an estimated £11.7bn, but green taxes and charges in that year had made £21.9bn.

It claimed ministers were "cynically" raising revenue rather than using the money to improve the environment.

But the Treasury said the pressure group's claims were "ridiculous".

'Over-paying'

But the Taxpayers' Alliance said the £11.7bn figure covered the "social cost" of climate change to the world, such as weather changes and related disasters.

It added that UK green taxes should not exceed this figure.

The group also said that, on average, UK households were "over-paying" £400 a year.

Fuel duty and vehicle excise duty were between 30 and 40 times higher than the level needed to cover estimates of the social cost of CO2 emissions.

The doubling of Air Passenger Duty, announced in last year's pre-Budget report, was actually likely to have increased total emissions from air travel, creating incentives for longer flights, the report added.

Meanwhile, it said the landfill tax was raising up to £620m more than was needed to meet the social costs of methane emissions from landfill.

Corin Taylor, research director of the TaxPayers' Alliance, said: "Green taxes and charges impose substantial costs on, amongst others, northern manufacturers and the NHS.

"Green taxes in the UK are already well in excess of the level they need to be to meet the academic estimates of the social costs of carbon emissions.

'Unjustified'

"Every household is paying more than £400 extra in tax every year because green taxes are set too high.

"UK taxpayers are already more than doing their bit to pay for the costs of pollution and additional green taxes would be completely unjustified."

But a Treasury spokesman said: "The government's definition of environmental taxes includes those taxes that are designed to primarily have an environmental impact -- the climate change levy, aggregates levy and landfill tax.

"We make clear, for example, when setting fuel duty rates that the Government takes into account a range of factors, including costs of motoring such as congestion, and the need to maintain sound public finances.

"It is ridiculous to argue that the government is failing against its environmental objectives. The UK is one of a few countries on course to meet its Kyoto commitments. By 2010 we will have met it almost twice over - cutting greenhouse gas emissions by more than 20%."

A spokesman said: "In arguing against these taxes, the Taxpayers' Alliance are being doubly dangerous -- it would mean cuts to public services, schools and hospitals, as well as higher carbon emissions leading to accelerated climate change."

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We here at The Progress Report note that not only may the Kyoto targets be set too low but also that there's another way to resolve the issue of having "too much" public revenue -- that is, the government could share it among citizens, paying out the surplus as a dividend to residents or registered voters, much as Alaska does with oil revenue. Indeed, government would be rolling in revenue were it to charge -- at full market value -- all polluters, all depleters, and in general all users of Mother Nature. Getting this Citizens Dividend, people could get by with much less governmental service, and government, by recovering so much of this natural value, could lose the counterproductive taxes on earnings, enterprise, and buildings yet still do its job. Bottom line, don't charge people for the value they create but for the values they take. Then share the revenue raised