Cal­i­for­nia, Euro­pean Union can give China guid­ance on build­ing ETS

China Daily (Canada) - - DEPTH -

Jor­gen­son said a car­bon tax might be a more ef­fi­cient ap­proach for the ser­vices sec­tion of an econ­omy. “The idea is that if the car­bon tax is ad­min­is­tered as part of a tax sys­tem, then the col­lec­tion would be in the hands of the tax au­thor­ity, which al­ready in­ter­acts with all of these firms, even the small­est of them, through the ex­ist­ing tax sys­tem,” he told the Har­vard Gazette.

He said that if China does de­cide to use a car­bon tax for a por­tion of its econ­omy, the coun­try will have to an­swer, “How do you in­te­grate a car­bon tax that pre­vails in one part of the econ­omy with a trad­ing sys­tem that pre­vails in an­other part?”

Bri­tish Columbia

China may want to look at Bri­tish Columbia for guid­ance on a car­bon tax. The province is Canada’s third-most pop­u­lous, and it be­gan tax­ing car­bon diox­ide and other green­house-gas emis­sions from com­bus­tion of fos­sil fu­els in 2008.

Ac­cord­ing to the US-based Car­bon Tax Cen­ter, since 2008 per capita emis­sions of car­bon diox­ide and other green­house gases cov­ered by the Bri­tish Columbia tax have de­clined, con­tin­u­ing a down­ward trend that be­gan in 2004. Av­er­aged across the pe­riod with the tax (2008 through 2013; no data are avail­able for 2014), province-wide per capita emis­sions from fos­sil-fuel com­bus­tion cov­ered by the tax were nearly 13 per­cent be­low the av­er­age in the pre-tax pe­riod un­der ex­am­i­na­tion (2000-2007).

How­ever, not all are sup­port­ive of a car­bon tax. The Amer­i­can En­ergy Al­liance (AEA), the ad­vo­cacy arm of the In­sti­tute for En­ergy Re­search, said car­bon taxes make gaso­line and elec­tric­ity more ex­pen­sive, with a heav­ier bur­den on low-in­come earn­ers. It will also in­crease the price of most goods and ser­vices since en­ergy is a key cost com­po­nent, the AEA said.

Jor­gen­son noted that Aus­tralia once had a car­bon tax and re­pealed it.

Con­tact the writer at paul welitzkin@chi­nadai­lyusa.com

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