Stéphane Dion’s Liberals have released their Green Shift plan that would make big changes in our tax system. For a good summary, see this post by the Canadian Capitalist. Dion plans to shift some of the broad-based tax burden on all individuals and companies to just those who pollute.
So, the final price of goods and services that cause pollution would go up. Whether you support this type of taxation or not, it is clear to me that this is the only way to cause people to change. Begging people to be green is mostly ineffective. But taxing people less and making some items expensive may cause people to make different choices.
There are a number of big ifs in this plan. It will work
if the Liberals get elected (does not seem likely right now),
if there are no loopholes for polluters to get around the new legislation, and
if the government doesn’t cave to pressure to make exceptions for certain polluting industries.
It may not seem like it makes any difference to tax you $250 less and simultaneously make your living costs for the year $250 higher. But, prices won’t be uniformly higher, and this will cause you to make different choices.
I’m always suspicious when politicians tell me that some plan is revenue neutral. Even if it is revenue neutral based on current patterns of consumption, it may not be after spending patterns change.
Whether this is the right plan or not, I’m convinced that the only way to change our day-to-day choices and reduce greenhouse gas emissions is with financial incentives; basically making desirable choices cheaper and undesirable choices more expensive. The same approach is needed to reduce our garbage production.