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Credit for being green

Posted by CornishEurals on Saturday, 10 March 2007 22:39:46

While there is a certain amount of moral justification for charging taxes if you are not green, how about some carrots alongside the sticks?

I would be so much more encouraged to be greener if I was to recieve credits for being a low polluter.

For instance, could I potentially see a drop in my income tax/council tax if I proved I was completely green? This seems to fit in to the aged old Tory policy of low taxation.

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Posted by providor on Sunday, 11 March 2007 07:45:58

Personal Carbon Allowances, aka Domestic Tradeable Quotas or Carbon Credits, would do exactly what you are asking for.

http://www.mng.org.uk/green_house/mechanisms/brilliant_ideas/tradable_quotas.htm

If you reduce your CO2 emissions below your personal allowance, you get the carrot - you can sell your unused credits for cash. If you are extravagent and wasteful and emit more than your fair share of CO2 you get the stick - you have to spend money on additional credits to cover your excess emissions.

The total number of credits issued gets reduced year by year, thereby providing a simple, transparent and guaranteed way of reducing the country's total CO2 emissions. As the supply of credits diminishes, their market value increases, so the carrot and stick get correspondingly bigger.

The beauty of this system is that it avoids the criticism that "it's just using climate change to raise more tax" because it clearly is not taxation, it's rationing. Also, because it's similar in concept to existing systems like Visa and Tesco Clubcard and could probably piggyback on the existing infrastructure, it would be easy to implement and readily understood by consumers.

David Miliband seems to be a fan of PCAs, which have been discussed several times on his DEFRA blog, e.g.

http://www.davidmiliband.defra.gov.uk/blogs/ministerial_blog/archive/2006/07/19/1557.aspx

I'm waiting to see if they feature in the upcoming Climate Change Bill. I'd be interested to know if Conservative policymakers have looked at this idea.

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