Why the carbon tax is a bullet well-dodged

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Recently, the Conservatives axed a plan to introduce a carbon tax aimed at commodities where production releases a large amount of greenhouse gas (or otherwise environmentally harmful substances). The catch: this tax would target the common consumer rather than the manufacturer.

Originally, this was suggested in an initiative to help the UK reach its goal of carbon neutrality by 2050. The Prime Minister had asked Whitehall to devise a price which would rise based on how much damage a product did to the environment, caused by factors like the amount of methane expelled, miles in transit and fertilizer used. However, due to a projected steep rise in the price of household necessities like lamb, cheese and beef, as well as all non-sustainably produced energy, the government deemed it untenable.

John O’Connell of the Taxpayers Alliance stated that ‘eco-taxes would leave slim pickings for struggling families, who rely on cheap energy and food’, which is even more worrying in today’s fiscal climate, where economically marginalized people are finding their situation ever-worsening. The current Covid-induced recession, which is anticipated to last for decades, has already caused Chancellor Rishi Sunak to reduce Universal Credit, increase council tax and freeze public sector wages, making further taxation on household necessities unviable without pushing many under the poverty line.

The impact of it on a global scale would be minimal

Nonetheless, time waits for no man, and the climate change point-of-no-return draws ever closer. Unless the Tories commit to decisive and radical action, they’re going to condemn us and the planet to a very toasty future. The current drawbacks of a carbon tax beg the question, would it even have been suitable in a world without coronavirus? A carbon tax that hit big greenhouse gas producing companies rather than everyday consumers has its own pitfalls. People living paycheck to paycheck, on minimum wage or benefits, would be punished the most, as companies would likely raise the price of their product to cover at least a part of the cost of taxes or cut their workforce.

A middle and upper class with large wads of disposable income would be relatively unscathed, simply complaining about Waitrose charging £5.50 for a wedge of parmesan, which would ultimately only worsen wealth inequality and entrench class divides. Alternatively, industries may just up sticks and leave the UK, preferring countries with no eco-taxes (maybe even ones where they can sell to EU states without tariffs), cutting out a huge chunk of our economy.

Even if a tax is put in place and did drastically reduce the UK’s carbon footprint, the impact of it on a global scale would be minimal. England is often stuck in a colonialist mindset, overestimating our importance in international affairs. Overall, the UK produces only 1% of the world’s carbon (which is still poor, considering we only account for 0.8% of the world population). Furthermore, many of the goods we consume are outsourced and produced in other countries, like China or India, meaning that the UK is essentially exporting our CO2 and pollution, often to countries that are still in the process of full industrialization.

Ineffective at best and economically disastrous for marginalized communities at worst

So, what could actually be done? Even a complete reduction in emissions the UK’s would be a drop in the environmental ocean. However, as the sixth-largest global economy, we still have hitting power when it comes to persuading the international community to change. As already mentioned, many of the goods we consume are produced elsewhere and imported, so we have one of the highest global rates of consumer emissions. Therefore, international trade tariffs are a viable option to encourage international companies to manufacture in a more environmentally friendly way or to encourage the public to buy British, which would reduce air miles and ensure production is up to our environmental and ethical standards.

Alternatively, the UK could take trading responsibility for the products we import, providing aid to countries we have damaged by outsourcing our emissions. This looks like investing in providing carbon sinks (like planting forests) or giving money to companies that reduced emissions methods in industry, therefore reducing both localized industrial areas, and reducing global emission.

All in all, though a carbon tax in the UK is likely to be ineffective at best and economically disastrous for marginalized communities at worst, there are options available to the government if they’re willing to take decisive action that harms their billionaire pals, rather than people on universal credit, single mums, and those trying to stay afloat. Hopefully, the UN will manage to beat some sense into Boris at the upcoming COP26 next November.

Image: Nattanan Kanchanaprat from Pixabay

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