New green taxes were expected in yesterday's pre-budget statement, and when they came they upset the environmental lobby and everyone else as well.
Sir Nicholas Stern's recent report on the costs of climate change said that every country should devote 1% of GDP to combating climate change, but the new taxes are estimated to cover little more than a tenth of that. We saw an increase in petrol duy of 1.25p/litre and a doubling of air passenger duty. Stamp duty will also be abolished on "zero carbon-emission" homes for a limited period. This will apparently encourage more to be built, though there will be no immediate benefit from the new rules because there is no stamp duty on new homes, only on the sale of existing properties. Apparently such homes could save 8m tonnes of carbon per annum by 2050; not a great deal compared with the UK's total annual emissions of 150m tonnes.
The petrol duty was seen as not nearly enough by Greenpeace. They wanted the Chancellor to bring back the "fuel escalator" which added regualr increases to the price until the government abandoned it in 2000 in the face of the fuel protests which blockaded refineries. Transport organisations said the increase was unjustified as it would simply put up the prices of everything in the shops. There was criticism of the air passenger levy as well: it would not stop people flying but simply cost them more.
The whole problem with green taxes is surely that if people pay them, the policy has failed. If taxes are supposed to stop people doing things that will harm the environment they will only work if people have an alternative. Otherwise, it's just gesture politics and another way of getting money out of people!
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