Study says fuel taxes are the best way to encourage sales of greener cars

[mblakele]

http://www.economist.com/news/finan...y-encourage-sales-greener-cars-not-easy-being

A new paper by Anna Alberini and Markus Bareit compares policy changes in Switzerland’s 26 cantons to changes in new car sales in each area between 2005 and 2011 as a natural experiment. The least efficient policy was the annual rebate for owning a green car. The authors found this was much less effective than raising the annual registration fees on dirty cars, which had the bonus of raising revenues.

But even that was inefficient. Every tonne of carbon saved by the purchase of greener cars cost the consumer SFr810 ($815), over seven times the government’s estimate of the economic cost of higher emissions. Higher fuel taxes were more effective: the authors found a 16% increase in petrol duty had the same effect as a 50% increase in registration fees.​

 

[Sharkbait]

More taxes? Hmmm, I wonder how more taxes has curbed cigarette smoking and alcohol consumption? I don't think that's the answer, and I'm a strong proponent of anything green, generate all the power I need with solar with reserve for the M3 that I will hopefully will see in 18 months. I would prefer to see government subsidizes to oil companies cease and divert the funds to sustainable power and energy.

 

[Evbwcaer]

I've got to disagree with a key point here .

The article cites taxes as a motivator. Until there are no subsidies for fossil fuels, you can't in any genuine way called an associated fee, a tax.

Today, the IMF says fossil fuels are subsided something like 5 trillion per year and that will go up as climate change progresses.

Any "tax," unless extremely high, will only be a subsidy reduction.

The reason this distinction is important is because it changes the headline to, "When free markets are allowed to function, lesser polluting vehicles have the competitive advantage."

That headline is more honest, more factual, has more appeal to more people and would lead to a cleaner, healthier world.

 

[dabbler]

I've got to disagree with a key point here .

The article cites taxes as a motivator. Until there are no subsidies for fossil fuels, you can't in any genuine way called an associated fee, a tax.

Today, the IMF says fossil fuels are subsided something like 5 trillion per year and that will go up as climate change progresses.

Any "tax," unless extremely high, will only be a subsidy reduction.

The reason this distinction is important is because it changes the headline to, "When free markets are allowed to function, lesser polluting vehicles have the competitive advantage."

That headline is more honest, more factual, has more appeal to more people and would lead to a cleaner, healthier world.

Raising taxes have a greater effect on lower income families than anyone else. Not the answer! Eliminate the government subsidies to "big oil" and "coal" promote renewable energy.

 

[James Anders]

Yes. Increased taxes on gas hurt poor people the most.

 

[Tanquen]

Raising taxes have a greater effect on lower income families than anyone else. Not the answer! Eliminate the government subsidies to "big oil" and "coal" promote renewable energy.

Yes but the price of everything goes up and oil/gas dose whatever the flip it wants. If you tax it we'll at least get some of that money back as it hits a price that slows consumption and be able to help pay for roads and the damage gas and oil cause. It's going to go up anyway and we may as well get some tax revenue rather than most going to the oil companies that magically can't seem to do anything about it.

 

[deonb]

More taxes? Hmmm, I wonder how more taxes has curbed cigarette smoking and alcohol consumption?

There is no equivalent alternative to cigarettes and alcohol. There is to gasoline vehicles.

I would prefer to see government subsidizes to oil companies cease and divert the funds to sustainable power and energy.

That has the same effect as raising taxes - you're increasing the price of the product to the consumer. Sure, why not - if that makes you sleep better at night. As long as the price of gas start reflecting the currently unpriced externalities in the product, I'm good.

 

[Sharkbait]

There is no equivalent alternative to cigarettes and alcohol. There is to gasoline vehicles.

Sure there is. Amongst other things, it's called drugs or any other abuse substances. That's why taxing marijuana is becoming so attractive to state legislatures.

That has the same effect as raising taxes

Not raising taxes but reallocating them.

 

[nwdiver]

Sure there is. Amongst other things, it's called drugs or any other abuse substances. That's why taxing marijuana is becoming so attractive to state legislatures.

I don't know anyone that replaced tobacco with pot... increased taxes on alcohol and tobacco aren't as effective because as mentioned there are no alternatives.

You really think that more expensive gasoline won't help EV sales? Really? Say it... say, 'More expensive gasoline won't help sell more electric vehicles'; Yeah... sounds insane... right?

Yes. Increased taxes on gas hurt poor people the most.

There are ways to structure taxes so they help the poor. You can make the tax regressive so that all taxes collected go into an EITC or simply as a check to everyone below a certain income level. So if you're making ~$30k/yr but smart enough to drive an efficient vehicle you'll actually get a raise. Lots of ways to make this work...

 

[Drivin]

Raising taxes have a greater effect on lower income families than anyone else. Not the answer! Eliminate the government subsidies to "big oil" and "coal" promote renewable energy.

uhhh, when those subsidies are removed and prices go up, lower income families will be disproportionately affected.

 

[Sharkbait]

There are ways to structure taxes so they help the poor. You can make the tax regressive so that all taxes collected go into an EITC or simply as a check to everyone below a certain income level.

Our government has already done that to the point where 'low income' people have free everything - even free electricity or highly subsidized electricity. No, the average hard-working Joe that reports income and pays taxes doesn't want more taxes taken from his paycheck or at the pump. I don't either.

We pay enough taxes, upwards of 40% here in California when you combine both federal, state, and local taxes. That's enough. It the feds or state want to implement a new 'program' they need to shutdown another one to offset the cost the other. Enough!

 

[nwdiver]

No, the average hard-working Joe that reports income and pays taxes doesn't want more taxes taken from his paycheck or at the pump. I don't either.

That's kinda the point... if the average hard-working Joe doesn't want to pay more taxes then he can stop destroying our future by buying gasoline.... plenty of cost effective alternatives available. Most people aren't going to do the right thing until it starts getting painful to keep doing the wrong thing. It's just a sad fact of human nature.

One POS I work with recently bought a new camero for $45k... I'm willing to bet that $10/gal gasoline might have shifted that decision a bit.

 

[Sharkbait]

I'm willing to bet that $10/gal gasoline might have shifted that decision a bit.

When greedy oil companies, refiners, the fed and the states have gas at $10/gal., and you are driving in your Tesla, there is nothing to stop you from mailing off some sympathy dollars to the IRS and state capital for all the dollars you 'stoled' from them.

The last time I checked, they are still taking donations to offset the deficits they have created so they can continue to pander to all those living off 'programs' and get re-elected only to legislate more 'programs'. It's a vicious cycle that never seems to end. BTW, most pols have cars and fuel paid for by the electorate. They would not be affected by higher gas taxes, so more gas taxes would be attractive to them. 'That's kinda the point....'

 

[rays427]

There is no alternative to tobacco or alcohol??? You can always just stop smoking or drinking. My father in law actually stopped smoking because he said it got too expensive.

 

[ItsNotAboutTheMoney]

Raising taxes have a greater effect on lower income families than anyone else. Not the answer! Eliminate the government subsidies to "big oil" and "coal" promote renewable energy.

That's not an excuse, although it's a common straw man argument given by Republicans who seem to care a lot about the poor when it comes to indirect taxation changes (that have a greater absolute impact on wealthier people), but not when it comes to direct taxation.

It's not the change itself that's a problem, but the rate of adoption. What's needed is a phase-in, gradual increases and an adjustment in the minimum wage that takes it into account. But that never happens, because of reactive politics.

 

[Evbwcaer]

When there is talk about the average joe not wanting more taxation.....well the economic point is missed. I understand that most average joes won't carry the economic thinking this far, but:

Average Joe is paying for pollution with his lungs, with acid rain, with climate change and social instabilities that will result, with severe weather generally raising food prices.

In fact, our society subsidies fossil fuels about 5:1 with renewables, see IMF.

So we pay more for all of the negative things listed above. Read that again. We could pay less and not have the bad things above. Read that again too.

So, now explain to me how if we stop paying 5:1 for a bad thing, that is going to hurt Average Joe.

The retail price of his gas might be higher, but his lung cancer will onset later, his homeowners insurance will be less, his food prices lower and more stable, and on and on.

It wakes out to a better health, moral, and economic result for Joe, all data suggests.

 

[nwdiver]

When greedy oil companies, refiners, the fed and the states have gas at $10/gal., and you are driving in your Tesla, there is nothing to stop you from mailing off some sympathy dollars to the IRS and state capital for all the dollars you 'stoled' from them.

Well... we're talking about fuel taxes... not fuel profits so the oil companies and refiners aren't making any more money.

And you can structure the taxes to be revenue neutral. It's not like government isn't capable of managing a revenue neutral program... social security has been operating for ~80 years now. You collect taxes from gasoline and distribute those funds progressively based on income. Don't want to pay the 'tax'? Then don't consume fools fuel... you don't have to splurge on a Tesla... buy a used LEAF or Volt for ~$10k. Pretty simple.

You don't hurt the poor and you punish the fools too ignorant or selfish to give up petroleum. You got a better idea to breaking this addiction faster?

 

[ReddyLeaf]

So instead, should we do what WA State did, add a $150 TAX on EVs? I spend more on my EV TAX than on my gas vehicle (and it gets 20-25 mpg). WTF? Yup, that makes PERFECT sense especially in WA State, where 100% of our petroleum is imported and probably >90% of our electricity is locally produced and carbon-free. Yup, you can thank our no-tax Republicans for that. Personally, I support increasing gasoline taxes, car registration costs, etc. until the number of cars on the road decreases to the point where "rush" hour traffic has an average speed EQUAL to the posted speed limit. Will that impact the poor more than the middle class? I doubt it. In the end, everyone will benefit due to better roads, less time spent in traffic, better driving efficiency, less pollution, etc. Next up is "free" EV charging at work using solar power, just a thought.

 

[Drivin]

One POS I work with recently bought a new camero for $45k... I'm willing to bet that $10/gal gasoline might have shifted that decision a bit.

Shifted it to what? Buying a 75k car?
Sure, that would totes happen. Totes.
LOL

 

[nwdiver]

Shifted it to what? Buying a 75k car?

LOL

Used Volt is <$8k...