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McQUARRIE – The foolishness of the make-believe ‘revenue-neutral’ carbon tax

GasIN THIS COLUMN I’ll be talking about British Columbia’s carbon tax.  But wait. Don’t click on and close this tab quite yet, as the next 700 or so words won’t necessarily be as boring as you might imagine.

mcquarriecolhednewYou see I believe B.C.’s version of the carbon tax is ill thought out and wrong.  It makes me feel like I’m being tricked into thinking I have bought my way into carbon emission happiness…a greenhouse gas nirvana of sunshine and lollypops.

In particular, I’m bothered by the concept of revenue neutrality that states all revenue generated through the taxation of carbon will be offset by an equal reduction in our income tax.  Think about that for a moment and hopefully the foolishness of this being a credible tax policy will start to jell.

To help the process along, let’s apply the same thinking to downtown parking.  What if City council announced a new revenue neutral policy regarding income from parking meters and parking tickets?

Parking meters are installed to regulate the amount of time anyone is allowed to use a downtown metered parking space.  By attaching regulations, a cost and an additional cost for failure to comply, the system, for the most part, works.

One day though, City council decides to make it revenue neutral and announces that all meter income will be matched and offset by an equivalent reduction in your property tax. In one swift stroke, the purpose of regulated parking along with its income vanishes. From that point on, who cares about meters, time limits or fines?  There is no consequence, so park wherever and for as long as you like.

If that sounds a bit far fetched, why then is it a sensible system for our current carbon tax regime?  We acknowledge that carbon emissions are a huge problem and introduce a carbon tax as a way to attach a financial consequence to our continued practice and reliance on fossil fuels.  Like the parking meter, there is a cost attached and so far so good as people seem more responsive, aware and careful when their actions cost them money.

However, this revenue neutral shenanigans that promises no consequence, turns carbon tax into a meaningless, feel good PR stunt by government.  We are being duped in a number of ways and with our own money.

You are not helping climate change at the gas pump because the extra you pay in carbon tax goes nowhere but to general revenue.  Why does it go to general revenue?  It has to because our government promised to reduce taxes and as a result needs that carbon tax money to cover expenses those real tax dollars once paid for.

Revenue neutrality has by its very nature made sure climate change is not a priority to this government. So, what is the answer or for that matter is there an answer?

When carbon tax was first brought in, the B.C. government of the time (Gordon Campbell’s Liberals) introduced a new fund called the Innovative Clean Energy Fund or ICE.  Using all of the income from the carbon tax, ICE was to fund academic and private sector research and development in the field of alternative energy solutions and CO2 mitigation.  In other words, use the tax to reduce current emissions and look at new ways to develop alternatives.

Unfortunately, in just a few short years, the amount going to ICE dwindled, R&D is going nowhere and mitigation is not happening. ICE still exists, is underfunded and has gone several years since it last called for ideas and submissions.  This concept of revenue neutrality combined with a cash starved government has pretty much killed it.

Personally I feel there is an answer and frankly, it is staring us in the face, already exists and is called carbon tax.  Weird eh?  The only missing component is a government with enough courage to make it do what it is suppose to do.

Just like those parking meters.  Forget this make believe game of a revenue neutral tax and let me honestly contribute towards a solution.  Don’t give it back to me in the guise of lower personal taxes but instead use that new money for what it was meant to do. Make you and me responsible.

To those who selfishly whine of the economic doom and gloom that would result from an honest carbon tax?  I say, tough luck as I think it’s time you start thinking about how much your current inaction and irrational economic fears are going to cost your children.  Not someone else’s children, or those a few generations from now but your kids.  The ones who are already frightened about their future and are asking you… What are you going to do about it?

On a personal note, I truly enjoy reading your comments.  Whether you agree or disagree with me, I always look forward to seeing your voice added to the discussion. Over the months, it’s become obvious from reading what you have to say that a lot of thought and insight goes into expressing your opinions. As a courtesy and despite at times wanting to jump back in, I stay out of this follow-on conversation…I had my chance and now it’s your turn and I encourage you to join the conversation and continue to add your thoughts and comments.

Bill McQuarrie is a Kamloops entrepreneur. He can be contacted at billmcquarrie@gmail.com. He tweets @mcrider1.

About Mel Rothenburger (9358 Articles)
ArmchairMayor.ca is a forum about Kamloops and the world. It has more than one million views. Mel Rothenburger is the former Editor of The Daily News in Kamloops, B.C. (retiring in 2012), and past mayor of Kamloops (1999-2005). At ArmchairMayor.ca he is the publisher, editor, news editor, city editor, reporter, webmaster, and just about anything else you can think of. He is grateful for the contributions of several local columnists. This blog doesn't require a subscription but gratefully accepts donations to help defray costs.

3 Comments on McQUARRIE – The foolishness of the make-believe ‘revenue-neutral’ carbon tax

  1. I would agree that revenue from a carbon tax would ideally go to projects which would also reduce greenhouse gas emissions (e.g. clean transit, renewable energy projects), but the only way a tax was politically saleable at the time was to make it revenue neutral. Otherwise, it would have been too easy to oppose it, calling it a “tax grab”. BTW, the revenue is not distributed as tax credits to everyone, but rather only to those who are expected to be disproportionately affected by the tax (through higher gas prices, etc): low income British Columbians. The BC carbon tax has been studied extensively, and the conclusions are that it was an effective way to reduce GHG emissions without harming economic growth and without negatively impacting the poorest citizens. Since the current government froze the tax at 2012 levels instead of continuing to ramp it up as originally promised, its effectiveness has been somewhat eroded by inflation. All the same, it’s still being used as a model by other jurisdictions considering implementing a carbon tax.

  2. Good column. While I may not agree with you on any one subject, I always enjoy reading them.

  3. I clap vigorously for what I just read…make you and me responsible…that is revolutionary talk around here!
    But many will say “you can’t tell me what do” and go about their merry ways and keep polluting.
    We must live and live happy but without the obscene excesses most clamor as their rights.

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