Regular readers know that I am a proponent of a carbon tax with income tax offsets. See my essay The Case for Higher Gas Taxes for details.
A bill proposing that has now been proposed:
I’m Bob Inglis from South Carolina’s Fourth District. Thank you for being part of this virtual hearing on our bill—The Raise Wages, Cut Carbon Act of 2009. I’m here to talk about—and give you the opportunity to talk about—how to make this bill even better.
Let me start by describing where I think we are. Polling data shows for the first time in a number of years that people are actually valuing the environment below economic recovery. The challenge before us is to come up with something that works for both: accomplishes good economic progress and recovery, but also addresses the problem of climate change.
What if we start with a reduction in taxes? We chose the payroll tax. You pay 6.2% on the first $106,800 worth of income; your employer pays 6.2%. What if we reduced that tax, and then in its place imposed a tax for the first time on carbon dioxide? There would be no additional take to the government. There would be a tax reduction followed by a new tax, in equal amounts, so that it is truly revenue neutral.
Greg Mankiw also has something up on the issue:
From Congressman Bob Inglis:
Dear Pigou Club Members,
A revenue-neutral carbon tax could set up a bi-partisan triple play of this American century. We can clean up the air, create jobs, and enhance our national security.
My Raise Wages, Cut Carbon Act of 2009 cuts payroll taxes and, in equal amount, imposes a tax on carbon dioxide emissions. The tax is border adjustable and is designed to be WTO compliant.
We’re conducting a “Virtual Hearing” on the Raise Wages, Cut Carbon Act of 2009 in the hopes of improving the bill before I actually file it. I’ve kicked off the “hearing” with an opening statement, which you can find here, along with a copy of the bill, a summary, and various white papers addressing different portions of the bill. I’d love for you to look over these materials, and then tell me what you think by posting a YouTube response to my opening statement. You can do that here.
Thank you, and I look forward to benefitting from your expertise and insights!
Member of Congress (R-SC4)
Where do I sign up?
Hat tip to a reader for flagging this to my attention.