Monday, January 5, 2009

Campaign for Simple Green Tax Cuts

There are a lot of tax cut schemes out there aimed at helping the environment. Some, such as Ontario's removal of provincial sales tax from sales of bicycles under $1000, are simple and work really well (and should be made permanent). Others, such as tax cuts aimed at homeowners who are doing complete retrofits of their homes for energy efficiency, don't work nearly as well. For one thing, not too many of us can afford to spend thousands of dollars on home energy retrofits, so a few hundred dollars rebate doesn't really help. For another thing, a lot of these programs are heavily laden by red tape.

Politicians have come up with some interesting plans for green tax cuts and the stimulus of green industries, but they tend to be either ineffectual, or so complex that they never become implemented. Various "carbon tax" schemes of late come to mind... complex, confusing plans that, even if they'd work, can't be sold to the public because they're such a departure from the current status quo.

What I propose are simple, effective, targeted tax cuts. For example, in order to power my condo with renewable electricity, short of installing very expensive equipment, my best option is to purchase power from a company such as Bullfrog Power. Since I don't have the option of telling my existing electricity provider I only want power from renewable sources, buying from a third party entails additional expense on my part for doing the right thing. I'm sure that lots of people would like to purchase renewable energy, but are deterred by the added expense.

A Simple Green Tax Cut would be to make the purchase of renewable energy tax deductible. Really simple from both the government and consumer side. Effective, because it encourages people to vote with their dollars and make a market-driven shift to green energy happen. It's also probably a lot cheaper for governments to support green tax cuts like this than to pour money into power generation projects directly.

Since this is budget time for both the federal and provincial governments, the time is right to start sending letters to the Prime Minister, your Premier, and so on. Here's sample text for a letter:

As you're preparing your upcoming budget, I'd like to suggest a simple "green" tax cut. Currently, the easiest way for consumers to vote with their dollars when it comes to renewable energy creation is to source their electricity from places like

However, when doing so, consumers have to pay extra for their electricity... essentially they're penalized for making a positive environmental choice.

It would be really great if you made the purchase of renewable energy (say, up to $500 worth) by consumers tax deductible. This would provide incentive for a market-driven switch to renewable energy sources, without all the confusion of complex carbon tax schemes.

So get those letters started! Send e-mails to the Prime Minister and your provincial Premier (Ontario's Premier). The public needs to give politicians ideas like this to move forward with, and we also need to let politicians know that there's a demand for action on this front. Change comes about when people make noise, not when they stay silent.

Leave comments if you'd like to share your ideas for Simple Green Tax Cuts!

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