The Revenue Neutral Carbon Tax – It’s Working – in British Columbia

Oh, limiting carbon emissions is so complicated.  How are we ever going to get it done?  You’ve got credits and offsets and trading.  Oh, it’s just so hard.

No it’s not.  You just have to get serious.  The method is very easy.  Tax fossil fuels, collect the tax and then rebate it to the people who are going to create real solutions: citizens and businesses.  The government only keeps enough of the money to administer the program.

Impossible, you say?

British Columbia has been doing it for five years, and the carbon tax is working great.  Not only have people in BC reduced carbon emissions but the carbon tax has actually lowered personal income taxes:

It [the carbon tax] also saved many of them a lot of money. Sure, the tax may cost you if you drive your car a great deal, or if you have high home gas heating costs. But it also gives you the opportunity to save a lot of money if you change your habits, for instance by driving less or buying a more fuel-efficient vehicle. That’s because the tax is designed to be “revenue neutral”—the money it raises goes right back to citizens in the form of tax breaks. Overall, the tax has brought in some $5 billion in revenue so far, and more than $3 billion has then been returned in the form of business tax cuts, along with over $1 billion in personal tax breaks, and nearly $1 billion in low-income tax credits (to protect those for whom rising fuel costs could mean the greatest economic hardship). According to the BC Ministry of Finance, for individuals who earn up to $122,000, income tax rates in the province are now Canada’s lowest.  [emphasis added]

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