So, either the tax works and ... there's a tax black hole ... or ... the environment still gets destroyed.
What, a bit like the Climate Change Levy, you mean? Or fuel tax? Or carbon credit trading? Have I missed any other similar Labour policies? If you don't have the environmental taxes, then by your apparent reasoning you don't get the revenue *and* the environment still gets destroyed...
As for Mr Rooney, a quick look at the Green Party website suggests that they demand increased aviation taxes and national road user charging, and oppose any cuts in fuel tax. So again with the strong enviro-taxing.
You've presented a false dichotomy. What punitive taxes actually do, is provide an incentive to avoid the "undesirable" behaviour. Some people cannot avoid it, or are better paying the tax than abstaining, and they put cash into the treasury. You'll not that people do actually pay fuel tax - there is no "black hole", and there is evidence to suggest that people use less petrol than if it were one third the price (America).
One question is whether the Lib Dems have accurately accounted for this change behaviour in doing their sums - I suspect not, because it's clearly a very imprecise art. Likewise, would they really raise 13 bn from the Capital Gains changes, or would people shift to other assets to a greater-than-expected degree? The other question is whether it matters, since once the scheme is in place you can increase the rates of taxation to at least attempt to balance the books, while maintaining the incentive.
If Gordon Brown had thought of all this, you'd be wetting yourself with joy. In the case of adjusting road tax for environmental reasons, remember that he announced an extension of this exact principle in the last Budget? He has the difference between the average car and the worst gas-guzzler as something desultory like a couple of hundred quid, instead of a figure which might actually affect a car-buying decision. But if Gordon had announced it, and George Osborne had suggested that it would cost jobs, you'd call Osborne an idiot instead of nicking his jokes.
I don't defend the details of the current announcement because I don't entirely understand it. In particular, I'd want to know whether someone on a low wage but who has to drive to work to avoid losing their job, and has no reasonable prospect of finding an equivalent job accessible by public transport, will end up better or worse off by the combined progressive change (to income tax) and regressive change (the enviro-tax). Don't get me wrong, these proposals might well be complete bobbins.
But to say, as you do, that environmental taxes are inherently unworkable is firstly blatantly wrong, and secondly a stern indictment of your own party's policy.
I'm not against enviro-taxes, especially as means to change people's behaviour. However, as I've seen it presented, the LDs are stating that this increase will account for c.£8bn of the £18bn lost by a 2p cut in the base rate.
Now, as they are presumably basing that new income on current figures or car-use etc I find it hard to see how they can have a situation where both the desired change in people's behaviour and the same level of cash in the public purse are compatible.
As you say, they could then continue to increase the rate of taxation for enviro-taxes but, until alternatives are widely available it will almost inevitable start to hit those who can least afford it most. Especially when you consider that the rich will be more able to switch to new technologies faster whilst the poorer will need to wait for prices to come down.
Josh points out that decreased car use will give us savings and these can be invested in some of those alternatives (better public transport for instance) which is cool. But a major increase in spending would be needed prior to that switchover for people to be able to make the switch so any savings would come later. That could work, but creates some interesting accounting in the short to mid term.
they are presumably basing that new income on current figures or car-use etc
That's one presumption, but it's possible that they're basing it on projected figures, either with our without some assumptions about how much car-ownership would change under their scheme.
a major increase in spending would be needed prior to that switchover for people to be able to make the switch
I said the exact same thing about the London congestion charge. I've been forced to accept that this is an issue on which no major party will behave well.
Fair enough, but if you introduce enviro-taxes and don't reduce something else, then you increase the overall tax burden. There's nothing inherently wrong with that, if it's what you want to do, but in the context of mainstream politics it's not exactly shocking to suggest that the overall tax burden doesn't need increasing.
So the Lib Dems have done what they think are the right sums (or perhaps have made something up to grab headlines), and figure that their enviro-taxes are worth a bit under 1p on the basic rate of income tax (with the capital gains tax adjustments being worth a bit over 1p). Would you (and, in general, the Greens) argue that their sums are wrong (as I think inskauldrak is doing), or just that you'd prefer to see them raise the general level of taxation?
What, a bit like the Climate Change Levy, you mean? Or fuel tax? Or carbon credit trading? Have I missed any other similar Labour policies? If you don't have the environmental taxes, then by your apparent reasoning you don't get the revenue *and* the environment still gets destroyed...
As for Mr Rooney, a quick look at the Green Party website suggests that they demand increased aviation taxes and national road user charging, and oppose any cuts in fuel tax. So again with the strong enviro-taxing.
You've presented a false dichotomy. What punitive taxes actually do, is provide an incentive to avoid the "undesirable" behaviour. Some people cannot avoid it, or are better paying the tax than abstaining, and they put cash into the treasury. You'll not that people do actually pay fuel tax - there is no "black hole", and there is evidence to suggest that people use less petrol than if it were one third the price (America).
One question is whether the Lib Dems have accurately accounted for this change behaviour in doing their sums - I suspect not, because it's clearly a very imprecise art. Likewise, would they really raise 13 bn from the Capital Gains changes, or would people shift to other assets to a greater-than-expected degree? The other question is whether it matters, since once the scheme is in place you can increase the rates of taxation to at least attempt to balance the books, while maintaining the incentive.
If Gordon Brown had thought of all this, you'd be wetting yourself with joy. In the case of adjusting road tax for environmental reasons, remember that he announced an extension of this exact principle in the last Budget? He has the difference between the average car and the worst gas-guzzler as something desultory like a couple of hundred quid, instead of a figure which might actually affect a car-buying decision. But if Gordon had announced it, and George Osborne had suggested that it would cost jobs, you'd call Osborne an idiot instead of nicking his jokes.
I don't defend the details of the current announcement because I don't entirely understand it. In particular, I'd want to know whether someone on a low wage but who has to drive to work to avoid losing their job, and has no reasonable prospect of finding an equivalent job accessible by public transport, will end up better or worse off by the combined progressive change (to income tax) and regressive change (the enviro-tax). Don't get me wrong, these proposals might well be complete bobbins.
But to say, as you do, that environmental taxes are inherently unworkable is firstly blatantly wrong, and secondly a stern indictment of your own party's policy.
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Now, as they are presumably basing that new income on current figures or car-use etc I find it hard to see how they can have a situation where both the desired change in people's behaviour and the same level of cash in the public purse are compatible.
As you say, they could then continue to increase the rate of taxation for enviro-taxes but, until alternatives are widely available it will almost inevitable start to hit those who can least afford it most. Especially when you consider that the rich will be more able to switch to new technologies faster whilst the poorer will need to wait for prices to come down.
Josh points out that decreased car use will give us savings and these can be invested in some of those alternatives (better public transport for instance) which is cool. But a major increase in spending would be needed prior to that switchover for people to be able to make the switch so any savings would come later. That could work, but creates some interesting accounting in the short to mid term.
Reply
That's one presumption, but it's possible that they're basing it on projected figures, either with our without some assumptions about how much car-ownership would change under their scheme.
a major increase in spending would be needed prior to that switchover for people to be able to make the switch
I said the exact same thing about the London congestion charge. I've been forced to accept that this is an issue on which no major party will behave well.
Reply
(The comment has been removed)
So the Lib Dems have done what they think are the right sums (or perhaps have made something up to grab headlines), and figure that their enviro-taxes are worth a bit under 1p on the basic rate of income tax (with the capital gains tax adjustments being worth a bit over 1p). Would you (and, in general, the Greens) argue that their sums are wrong (as I think inskauldrak is doing), or just that you'd prefer to see them raise the general level of taxation?
Reply
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