High oil prices? Tax cars & jet fuel! | 67 comments (67 topical, editorial, 0 hidden)

Re: Liebe Leipzig (none / 0)

I do think Tiefensee wants to help the environment (in general I assume the good will of any politician unless it becomes impossible to imagine what honorable motive an action could have), but I don't think that he proposes the best possible ways to do it. I think environmental policy should be efficient and targeted on the spot. When I want CO2 emissions to reduce, I tax the emission of CO2, not something which is just mildly correlated with CO2 emissions. If I want people to use less oil, I tax oil, independent of what people are doing with it. If I want something else, too, then I should tell that, too, and accept that the proposal is attacked on the basis of disagreement to these other goals.

The problem of Tiefensee is, that he is caught in traditional environmentalists thinking and this means often ignorance to any side effects outside a specific milieu. But these inefficient suggestions make normal people to think they have done a lot (or enough) for the environment, while the society as whole only creeps to sustainability. And this plays a role. Most people do not evaluate the effects of their actions on the environment for every single action. So the feeling of having done enough, has a lot of impact.

And with regard to his harmonsation dreams, that is really not new. New would be, if a country with lower gas taxes than all his neighbours would propose harmonisation, not when a country that has higher taxes (and therefore loses tax revenue from 'fuel tourism') proposes it. I would be seriously surprised if this becomes some kind of EU legislation.

Der Amerikaner ist die Orchidee unter den Menschen
Volker Pispers

by Martin (weiser.mensch(at)googlemail.com) on Thu May 29th, 2008 at 01:15:01 PM EST
[ Parent ]

Re: Liebe Leipzig (4.00 / 2)

In Denmark there seems to be two schools of thought among "traditional environmentalists," to use your term. One is to tax and ban based on environmental impact and then separately compensate the lower incomes if the tax or ban is regressive in nature. The other school is to tax and ban primarily stuff based on its pollution relative to its usefulness - which is usually progressive in nature, given that the people who consume most useless crap are, all other things being equal, usually the rich.

Under the second scheme, taxing cars and car fuel higher than heating is perfectly reasonable (for personal vehicles, at least). Cars, after all, are completely unnecessary for at least half the adult population - namely the half that lives in areas with a population density greater than roughly 250 people pr. square km.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu May 29th, 2008 at 01:35:55 PM EST
[ Parent ]

Re: Liebe Leipzig (none / 1)

In my opinion it is a very bad thing to tell other people what they have to take as useless crap and what as useful stuff.

And your argument is bad anyhow. What with the people who do not live in such dense populated areas? Why is heating reasonable, when it is possible to reinsulate houses in a way, that they don't need heating at all?
And of course you can live in a huge old villa, which is luxury and needs a lot of heating. There is no reason at all to assume that heating in general can't be as much luxury as car driving.
Therefore the first approach, to tax on environmental impact and compensate for regressivness is much better.

Der Amerikaner ist die Orchidee unter den Menschen
Volker Pispers

by Martin (weiser.mensch(at)googlemail.com) on Thu May 29th, 2008 at 02:11:30 PM EST
[ Parent ]

Re: Liebe Leipzig (none / 1)

Well, yes, telling people what is useless crap and what is not is not a good way of doing environmental policy. But the problem with the tax-and-compensate policy is that right-wing politicians are all too often happy to play ball on the tax part (because green taxes are usually regressive), but not so much on the compensate part (because the compensation schemes are, naturally, progressive).

So if you go by the former route, you will get better environment (compared to doing nothing) and less inequality. If you go by the latter route, but stop short of adequately compensating the poor who are regressively taxed, you get better environment but bigger inequality, which you will then have to redistribute your way out of.

In the ideal world, where the quid pro quo of the latter policy was clearly understood and accepted by all political actors, that would not be a problem. But in the real world, where we have to fight tooth and nail for any redistribution at all...

As for your counter-examples, there is no reason why car taxes cannot be tied to the location of the car through, for example, fees to enter or park in densely populated areas. Well, that and the fact that there is certainly a case to be made that population densities insufficient to support a rail line are insufficient, full stop.

Similarly, if one were to institute a tax on heating fuel - and an inheritance tax, a wealth tax and a progressive income tax to restore progressivity to the tax system - and use the proceeds to fund re-insulation of houses, then I would have no objection. But in the real world, what is usually proposed is simply heating fuel taxes, full stop, which is inherently regressive. Even worse, it hits tenants worse than home-owners, because the landlord has little financial incentive to improve the insulation (the tenant usually pays the heating bill, after all).

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu May 29th, 2008 at 02:58:32 PM EST
[ Parent ]

Re: Liebe Leipzig (none / 1)

Actually fees for entering a zone are something different, if the zone is not too big.

And if living in the countryside would be insufficient, it would turn out faster so, with a fuel tax, compared with a car tax. A car tax hits more people, e.g. driving once a week for buying stuff you can't get locally than long range everyday drivers compared with a fuel tax.

And with regard to political feasability of some progressive countermeasure to regressivity of fuel tax, I would say that a group in the position to implement a tax should as well be in the position to implement a benefit. Either you have legislative majority or you have not. My favourite by-measure would be to pay a unconditional basic income of the fuel tax revenue. Of course still some relatively poor people, e.g. long range commuters will be hit, but in the end one wants those people who use more than the average to pay for what they are doing.

Der Amerikaner ist die Orchidee unter den Menschen
Volker Pispers

by Martin (weiser.mensch(at)googlemail.com) on Thu May 29th, 2008 at 03:57:53 PM EST
[ Parent ]

Re: Liebe Leipzig (none / 1)

Yes, on the basis of environmental concerns, a fuel tax is superior to a car tax. No argument from me on that. I would much prefer to shift taxes from cars to fuel on an environmental basis. (Let's leave aside other externalities of a car such as congestion, which may justify taxing big cars purely because they are big.)

I would point out, however, that such fuel-taxes will have to be Unionwide, whereas car taxes can be implemented locally: In geographically small countries, fuel taxes can be evaded by "fuel tourism" in much the same way wealth taxes can be evaded by Swiss bank accounts. Cars, on the other hand, can be taxed locally, because cars have to be registered locally in order to be driven legally.

As for the political feasibility of compensating vs. taxing; in theory you are right. And in theory, theory and practise are the same. But take note of the most recent tax downsizings in Denmark: Taxes were downsized for the rich and richer, and the part of the tax downsizing that was financed at all was financed by green taxes. Now, I have nothing against green taxes, but using the income from green taxes to pay for tax downsizings that mainly benefit rich fatcats, that I do have a problem with.

(In the Danish example, a median-income family got precisely zero net benefit from the tax downsizing scheme - I'll leave it as an exercise to the reader to extrapolate downwards in the income distribution.)

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat May 31st, 2008 at 03:54:51 AM EST
[ Parent ]

High oil prices? Tax cars & jet fuel! | 67 comments (67 topical, 0 editorial, 0 hidden)

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