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Just another excuse for higher taxes

Ruth Lea, formerly of the Institute of Directors and now head of the Centre for Policy Studies, talks a lot of sense about tackling climate change. From The Telegraph:

Britain produces a mere two per cent of total global man-made carbon emissions and, as Stern himself has said, even if Britain closed all its power stations, that would be equivalent to only a year's increase in China's emissions. Last year, China embarked on a programme for building more than 560 large coal-fired power stations by 2012. Admonitions from the British Government will not stop them. It is an illusion to believe that if Britain leads, others will follow. This is a sad fantasy, I fear.

The record of international co-operation on climate change has so far been discouraging. Take the current Kyoto round, for example. Signatory countries agreed to binding reductions on greenhouse gas emissions averaging six to eight per cent below 1990 levels for the years 2008-12. But key countries, including America and Australia, did not ratify Kyoto, and China and India were excluded from the reductions scheme.

The EU15 countries have purported to be enthusiastic supporters, but most are well-off target. Britain, France, Germany and Sweden may hit their targets. Italy, Spain, Portugal and Ireland are emitting as if Kyoto doesn't exist. And the EU's emissions trading scheme is so slack that it is having no effect on the EU's total carbon emissions at all — and it does have the unfortunate side-effect that British business is forking out £500 million a year to buy spare permits from rivals in other member states.

Kyoto is, therefore, ineffectual. Talks are under way for its successor round, but there are enormous doubts as to whether it will be any more successful than the current one...

There is a case for green taxes. I favour reducing this country's dependence on fossil fuels, which will increasingly have to be imported from politically unstable regions of the world. If green taxes are used to incentivise the development of indigenous, non-fossil fuel sources of energy for transport and electricity generation, this is to be encouraged. But if such taxes are introduced, they should not just be seen as revenue raisers. There should be offsets for business in the form of, for example, corporation taxes cuts and for individuals.

Green taxes can be mightily unpopular, as shown by the fuel protests of September 2000, which led to the suspension of the fuel duty escalator. Perhaps the Government feels that, by emphasising the moral case for saving the planet, this will sweeten people's attitudes. I'm not so sure.