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Law professor argues for carbon tax in new book

The simplest, most effective way to reduce carbon emissions is to impose a tax on carbon, writes Dr. Shi-Ling Hsu in his recently published book The Case for a Carbon Tax: Getting past our hang-ups to effective climate policy (Island Press, 2011).

Hsu, a CMC-funded researcher and Law Professor at the University of British Columbia, says a tax could be implemented quickly and easily because it draws on already-existing tax collection infrastructure.

“This is something we could do right now. Provinces could raise revenues and it has no constitutional or legal complications.” Hsu favors taxing carbon use upstream instead of downstream at the level of the consumer. A tax implemented on industries would be passed on to consumers because higher costs to refiners lead to higher prices for gasoline, which will lead to reduced consumption.

Four approaches examined

In The Case for a Carbon Tax, Hsu examines four major approaches to curbing CO2: cap and trade, command and control regulation; government subsidies of alternative energy; and carbon taxes.  He comes down firmly on the side of carbon taxes, even though he realizes the solution is not a popular one.

No one wants new taxes. Not the public. Not politicians. Not businesses.

“Many people don’t like the idea of a tax. It communicates something to a person that’s unpleasant. But people hate it for all the wrong reasons.” Hsu says people dislike the tax because more than all of the other instruments that either purposely or unavoidably hide the true cost, a carbon tax puts the price tag in front of someone and says this is what it’s going to cost you.

It’s not likely the Canadian government will implement a carbon tax any time soon. Instead, Hsu is looking to an unlikely source – the U.S. government. When the Joint Select Committee on Deficit Reduction could not deliver a recommendation on ways to reduce the U.S. deficit by $1.2 trillion over 10 years by its November 21 deadline, it triggered automatic spending cuts to start in 2013.

“I expect someone will say ‘Hey, we need a new revenue stream’.”

Case for a Carbon Tax – Chapter 1

From The Case for a Carbon Tax by Shi-Ling Hsu. Copyright © 2011 Shi-Ling Hsu. Reproduced by permission of Island Press, Washington, D.C.