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Saturday, July 12, 2008

Taxing..


"An estimated 9.4 million motorists will have to pay more road tax in 2010-11 under reforms aimed at punishing "gas-guzzling" vehicles, ministers admit" saith the BBC.

This is another of our government's nasty "punitive" taxes which punishes those least able to do anything about it.

Let's get this straight. The evil we're trying to stop is the pumping of carbon dioxide into the atmosphere. Now then, there are a few obvious things we can do here:

1. Ban the sale of all new gas-guzzlers. i.e. Set reasonable minimum efficiency standards, like 50mpg plus.

2: Tax the sales of NEW gas guzzlers. That might encourage people to buy more efficient cars.

3: Tax the fuel. The more fuel consumed, the more tax collected. However, because of inelasticity of demand, those taxes might have to be punitive to get people to consume substantially less.

4: Ration fuel.

5: Tax secondhand cars annually... Errrm, nope... That does no good at all. It won't force people to buy more efficient secondhand cars, because unless people have already chosen efficient cars over the preceding decade, they won't be available in sufficient numbers on the secondhand market. Secondly, being hit by a punitive annual car tax lessens the money people have to spend on replacements, and, via the "market mechanism", the more efficient cars will have higher resale values.

I detailed the other reason why Gordon's new punitive car tax is completely stupid here back in March.

It's not size that counts, it's how much you use it!

Posted by Phil at 2:09 PM
Edited on: Wednesday, April 01, 2015 10:35 PM
Categories: Comment, Environment