VERMONT SPECIAL INTERESTS WOULD GRAB THEIR SHARE OF THE CARBON TAX

Vermont’s proposed carbon tax is as described in this URL. Proponents claim the carbon tax would be 90% “revenue neutral”, i.e., mostly returned to the economy likely in convoluted ways, via inefficient, ponderous, government programs in the form of “targeted” tax credits, subsidies, rebates, grants, etc. There would be taxpayer and employer tax rebates, but amounts and eligibility were not specified.

http://legislature.vermont.gov/assets/Documents/2016/Docs/BILLS/H-0...

VPIRG, financed by RE proponents of the carbon tax, commissioned a study by REMI, a consultant, which provided VPIRG, legislators, et al, with a report with pretty photographs, a rosy pro-carbon tax rationale, and talking points, to bamboozle voters regarding the merits of the carbon tax.

http://www.energyindependentvt.org/wp-content/uploads/2015/04/REMI_...

According to the graph on page 26, the carbon tax would increase from zero in 2016 to about $520 million in 2026. The tax rate would stop increasing in 2027, i.e., the tax collections would be decreasing in 2027 and beyond, because less carbon would be consumed. Any bill, if enacted, would add up to 2 years to the above timetable.

http://www.windtaskforce.org/profiles/blogs/vermont-energy-transfor...

This carbon reduction scheme would be in addition to another wasteful, political boondoggle, called Efficiency Vermont. See below.

http://www.windtaskforce.org/profiles/blogs/efficiency-vermont

The $520 million carbon tax, less 10% as subsidies for the Home Weatherization Assistance Fund, HWAF, and the Vermont Energy Independence Fund, VEIF, less sales tax reduction from 6% to 5%*, would yield the “leftover” carbon tax. All of that could not take place without some state and local bureaucrats spending time on it. The below table shows a 5% government administration cost.

* Sales tax reduction, per proposed bill would be: 

Fiscal year 2018, $31.5 million

Fiscal year 2019, $48.6 million

Fiscal year 2020, and after, $66.8 million

Left Over Carbon Tax: Below are listed the areas of combat that special interests likely would be engaging in. Those areas were not mentioned in the bill, because that would reveal hidden agendas. Once the carbon tax act is safely in place, “fine-tuning” acts likely would whittle away at the tax credits, etc., and provide even more subsidies to special interests, per Vermont economic development “policy”.

The paperwork involved would require many additional bureaucrats at state and local levels (for managing regional energy plans, per CEP rules). The bureaucrats would develop new rules and regulations and oversee the “allocating” of the carbon taxes. The increased inefficiencies would add additional headwinds against the near-zero, real-growth Vermont economy.

The state likely would allocate the money to various “worthy” programs and projects, as determined by legislators and special interests. The carbon tax would cause an orgy of feasting of unprecedented proportions, as it likely would be used to subsidize:

- HWAF, which would get the first $8 million/y out of the 10%.

- VEIF, which would get the remainder of the 10% to supplement federal subsidies to maintain solar build-outs, because the solar 30% investment tax credit will decrease to 26% in 2020 and 22% in 2022.

- Weatherizing buildings of low-income households and providing them with heat pumps and solar systems; a boon for rental property owners, who should be required to do that without subsidies.

- Electric vehicles, EVs. Not 50 MPG, high-mileage hybrids, as that would “lock in evil fossil fuels”.

- Building of EV charging stations everywhere.

- Charging electric vehicles with reduced-cost electricity. Usually, more upscale households own such vehicles.

- Whatever other programs and projects legislators and RE special interests desire, such as individual rebate credits, low-income supplements, employment-based rebates, market-rate weatherization, low-income weatherization, solar tax credits, etc.

Businesses would be allowed offset any carbon taxes against any taxes on profits, thereby reducing their state profit taxes. That shortfall would have to be made-up by others. This is done to get businesses “on board” to support the carbon tax, i.e., by shifting most of the carbon tax burden to easily plucked, less well organized, already-struggling households, which would not be allowed any such offsets.

Carbon Tax Impact On A Typical Vermont Family, as reported on VTDigger:

- The carbon tax would impose a $10 per ton tax of carbon emitted in 2017, increasing to $100 per ton in 2027.

- The carbon tax would generate about $100 million in state revenue in 2019 and about $520 million in 2027.

- The carbon tax would be added to the fuel prices at gas stations and fuel oil/propane dealers. Drivers should expect a tax increase of 9-cent per gallon of gasoline in 2017, increasing to about 89 cents in 2027.

- Homeowners, schools, hospitals, businesses, etc., should expect a tax increase of 58-cent tax per gallon of propane and $1.02 per gallon of heating oil and diesel fuel in 2027.

- A typical household (two wage earners, two cars, in a free-standing house) would pay additional taxes in 2027 of about:

- Some of the carbon tax extortion would be at the pump, some when the monthly fuel bills arrive, and some as higher prices of OTHER goods and services.

Driving = $0.89/gal x 2 x 12000 miles/y x 1/(30 miles/gal) = $712/y

Heating = $1.02/gal x 800 gal/y = $816/y

Total carbon tax in 2027 = $1528/y

Sales tax reduction 5/6 x 1400 = $233/y

Net tax increase = $1295/y  

- The hypocritical sop of reducing the sales tax from 6 to 5 percent would save that household about $233 in sales taxes, for a net loss of $1295 in 2027. That means such households, the backbone of the Vermont economy, would have about $1300/y less to make ends meet.

- Many of these households have had stagnant or declining, spendable real incomes (after taxes, fees, surcharges; other recurring expenses, etc.), plus dealing with a near-zero, real-growth Vermont economy, since 2000.

- With less real income, and higher real prices for goods and services, they also would have to make their own energy efficiency improvements.

 http://watchdog.org/250281/carbon-tax-debate-vermont/

Thank the Lord all of the above is not going to take place, because Scott most likely will stick to his pledge of no increases of taxes and fees; he should have added no increases in surcharges.