Why a carbon tax on investment income could make it less profitable to pollute
Why a carbon tax on investment income could make it less profitable to pollute
Following up on an paper posted earlier this week on disproportionate carbon emissions based on income. This article, by one of the paper's authors, proposes the possibility of imposing carbon tax on investment income as a more equitable means of influencing emissions.
Instead of putting the responsibility for cutting emissions on consumers, maybe policies should more directly tie that responsibility to corporate executives, board members, and investors who have the most knowledge and power over their industries. Based on our analysis of the consumption and income benefits produced by greenhouse gas emissions, I believe a shareholder-based carbon tax is worth exploring.
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Seems like a clumsy way to do an externality charge on carbon? Just charge the business
Per the article (had to update the link) - it's the same intent, but this approach shifts the burden of the tax up the income brackets, in theory minimally impacting the cost of purchased goods and services for low and middle income families.
It's a wealth tax meets carbon tax situation.
Increasing cost of capital which means the business needs to generate a bigger profit which means the price of the product goes up for consumers. Unnecessary dependencies - if you want to do a wealth tax do a wealth tax, if you want to do a carbon tax do a carbon tax
Yeah whatever taxation scheme we can think of, oil companies will ensure they don’t bear the cost.
That’s not quite the point I was trying to make. A company has to be about as profitable as any other in order to justify its existence. You need an externality charge (carbon tax) to drive the price of using oil to the point where people (and other companies) look for alternatives and use them instead. It doesn’t matter whether you charge oil producers or users- the end effect is the same.