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Like many pigouvian taxes, most carbon tax proposals make an attempt to offset its regressiveness by distributing some sort of dividend or rebate. The idea isn
by rrrrrrrrrrrryan 5y ago
Like many pigouvian taxes, most carbon tax proposals make an attempt to offset its regressiveness by distributing some sort of dividend or rebate.
The idea isn't to punish the poor for driving to work. Rather, it's an attempt to charge the major carbon-emitters for their pollution of the commons (the atmosphere), then compensate the public with that money.
- adam_arthur 5y agoIf there's a direct redistribution of sorts, then the poor can be protected from costs. But any policy without an explicit redistribution scheme will raise the cost of business, and thus, raise the cost to consumers (as businesses pass these on). e.g. for demonstration, imagine you sell apples for a 10 cent profit. Government enacts a 10 cent tax on apples. Now you must raise your price to consumers by at least 10 cents to stay in business. Consumer feels the effect of the tax Market based solutions are still best, though.
- rrrrrrrrrrrryan 5y agoTo (over)extend the analogy: growing apples specifically increases people's chances of dying each year by X%. (Akin to dying from cancer caused from smoke from wildfires caused by global warming, or hurricanes, or droughts in the 3rd world, etc). By raising the price of apples, some people might just choose to eat pears instead, and still collect their rebate from the apple tax. (People can buy electric cars, hybrid cars, take public transit, ride their bike, etc)