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A Tax on Fun? Or Sin?
The Conservative Party in Britain has a bright idea on carbon taxes: Impose a levy on air flights that is directly linked to that flight's carbon emissions.
At the moment, airlines have no real incentive to be carbon-efficient, even though emissions from airplanes are particularly harmful from a climate-change perspective.
The Conservatives want to change that, and propose a tax which gives every UK citizen one "free" flight per year, after which carbon taxes start kicking in.
Inevitably, airlines have attacked the idea as a "tax on fun."
Maybe the trick, at the outset, would be to make the new carbon tax lower than the £10 to £80 Air Passenger Duty it is to replace. If it can be spun as a tax cut, it might garner less opposition.
Then, as a "sin tax," it can always be raised later.
by Felix Salmon
Link to full post in Market Movers here.
Laura Rich is a co-founder of Recessionwire, which provides news, advice, perspective and humor about the recession and the recovery.
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