Green Tax Shift

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Description

Alanna Hartzok:

"Green tax shift policy is a rapidly emerging new perspective on tax reform which emphasizes the incentive capacity inherent in public finance policy. From this vantage point, taxation not only raises money necessary to fund governmental services it also reflects the overall value system of a given society, rewarding some activities while punishing others.

The goal of green tax shift policy is the creation of a system of public finance which will strengthen and maximize incentives for:

   * Fair distribution of wealth
   * Environmental protection
   * Wealth production
   * Provision of adequate government services
   * Peaceful resolution of territorial conflicts 

Green tax reform makes a clear distinction between private wealth and common wealth. Private wealth is that which is created by individual and collective labor. Common wealth is that which is provided by nature.

This public finance approach removes taxes from privately created wealth and increases taxes and user fees on common wealth domains used for human economic production. Captured in brief soundbites, "tax waste, not work," "tax bads, not goods," "pay for what you take, not what you make," and "polluter pays" become tax shift principles readily translated into voter friendly policy recommendations with broadbased political support.

Reducing or eliminating taxes on private wealth means slashing taxes on:

   * Income, especially from wages, payroll
   * Capital, especially of sustainable quality
   * Sales, especially for basic necessities
   * Homes and other buildings 

With careful calculations usually geared to overall revenue neutrality, green tax shifting balances cuts to the above by increasing taxes and fees on common heritage resource use such as:

   * Emissions into air, water, or soil
   * Surface land sites according to land value
   * Public lands for timber, grazing, mining
   * Electromagnetic spectrum
   * Geo-orbital zones
   * Oil and minerals
   * Fish in the ocean
   * Water resources 

Green tax shifters also aim to eliminate numerous subsidies deemed no longer necessary, environmentally or socially harmful, or inequitable and unfair. Slated for drastic reduction or complete removal are subsidies for: 1

   * Energy producton
   * Resource extraction
   * Waste disposal
   * Agriculture and forestry
   * Private transport and the infrastructure it requires
   * Investments designed to exclude labour from production. 

So far these reforms have been proceeding in a patchwork manner, but what matters is that the process has begun and the principles are being clearly articulated. Combining the efficiency and fairness taxation criteria of both Adam Smith and Henry George, green taxes largely comform to what a "good" tax should be: 2

   * Cheap to collect
   * Fall as clearly and directly as possible on the ultimate payer
   * Embody no favoritism or special exceptions
   * Correspond to the payer's ability to pay
   * NOT bring about undesirable economic distortions. 

Distilled to the essence,taxes should be cheap, direct, equal and benign. It is imperative that the fiscal policy for good democratic governance be guided by these fundamental principles. Unfortunately, most taxes are not based on what a good tax should be, but instead current public finance mechanisms largely exploit both people and the planet." (http://www.earthrights.net/docs/financing.html)