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> Energy-intensive goods tend to be more elastic, leading to higher energy footprints of high-income individuals. This is great news. If energy intensive goo

> Energy-intensive goods tend to be more elastic, leading to higher energy footprints of high-income individuals. This is great news. If energy intensive goods are more elastic, this means that carbon taxes will likely be very successful at reducing consumption of these goods. Now we just need to get some strong carbon taxes in place.

RhysU 6y ago
Would progressive taxation not already accomplish the intended goal of such a carbon tax by suppressing high-income consumption? Why add a second mechanism?
- ryukafalz 6y ago
  We want to encourage the use of less energy overall, but we also want to encourage the use of more efficient/less damaging forms of energy to the extent that we do use it. Progressive taxation accomplishes the former, carbon taxes accomplish the latter.
- andrewmutz 6y ago
  Only very indirectly. Progressive taxation would reduce consumption of everything, even things that had minimal carbon impact, whereas a carbon tax would reduce specifically consumption of polluting behaviors.
- Devils-Avocado 6y ago
  The people earning high incomes from their labour are typically the most productive members of society. They need to be able to enjoy the fruits of their labour without needing to resort to elaborate tax schemes. Part of the reason the USA is so much more successful and wealthier than Europe is because the taxes are much lower and simpler.
  - imtringued 6y ago
    Poland has a lower tax rate than Germany so why is Poland still behind Germany? How about an extreme example? Ukraine is not in the EU but it has an even lower tax rate than Poland. It's doing far worse even by polish standards (1/3 of the GDP per capita of Poland). There are companies that specialize in only hiring contractors and in a lot of cases this is simply done to avoid paying for social benefits. These are not necessarily highly paid individuals. In fact, many are at the bottom of the economic ladder.

RhysU 6y ago

Would progressive taxation not already accomplish the intended goal of such a carbon tax by suppressing high-income consumption? Why add a second mechanism?

ryukafalz 6y ago
We want to encourage the use of less energy overall, but we also want to encourage the use of more efficient/less damaging forms of energy to the extent that we do use it. Progressive taxation accomplishes the former, carbon taxes accomplish the latter.
andrewmutz 6y ago
Only very indirectly. Progressive taxation would reduce consumption of everything, even things that had minimal carbon impact, whereas a carbon tax would reduce specifically consumption of polluting behaviors.
Devils-Avocado 6y ago
The people earning high incomes from their labour are typically the most productive members of society. They need to be able to enjoy the fruits of their labour without needing to resort to elaborate tax schemes. Part of the reason the USA is so much more successful and wealthier than Europe is because the taxes are much lower and simpler.
- imtringued 6y ago
  Poland has a lower tax rate than Germany so why is Poland still behind Germany? How about an extreme example? Ukraine is not in the EU but it has an even lower tax rate than Poland. It's doing far worse even by polish standards (1/3 of the GDP per capita of Poland). There are companies that specialize in only hiring contractors and in a lot of cases this is simply done to avoid paying for social benefits. These are not necessarily highly paid individuals. In fact, many are at the bottom of the economic ladder.