A revenue neutral carbon tax is…
A tax on the carbon content of fuels. It is a price per ton of carbon that rises by a predetermined amount each year so that clean energy will become cheaper than fossil fuels.
Paid by energy companies. Carbon is taxed at the source, i.e., the point where fuels are extracted and put into the stream of commerce, or where fuels are imported into the U.S.
An incentive for fuel companies and consumers to reduce energy consumption and increase energy efficiency to avoid the increasing cost of carbon-intensive fuels and an incentive for investors to invest in efficiency and non-emitting energy production.
A way to lower the cost and increase competitiveness of non-emitting energy like wind and solar power.
Not retained by the government: the tax is revenue neutral, so the revenue would be returned to the public.
A net financial gain for most households: with revenue returned to the public, many households – especially those that use renewable energy and lower income households, which typically spend less on carbon-emitting goods and activities – will benefit financially from a carbon tax.
A “free market” policy that will level the energy playing field and give consumers more choice.
Recommended by many liberal and conservative economists.
Already working in British Columbia, Canada.