New Zealand will introduce a carbon tax of more than $20 a tonne this week, a move that the opposition says is too much.
Key points: Carbon tax introduced in New Zealand would raise $5bn annually, with most of it going to households with annual incomes of more $80,000 Carbon tax would be introduced on carbon dioxide emissions of power plants, cars and trucks Carbon tax has been a hot topic since the Rudd Government introduced the levy in 2013, but Opposition Leader Andrew Little says the tax will be introduced to stop New Zealanders from going green.
New Zealand first introduced a carbon levy in 2014 and has since raised more than a billion dollars through the levy.
But the tax has so far failed to slow emissions and has been met with widespread opposition, with many claiming it is unfair.
Key elements of the carbon tax include: • A 10 per cent levy on every tonne of CO2 emitted in New York and Washington DC.
• A $5 carbon tax for every $1 of CO₂ emitted in each of those two US states.
• Two-year emissions-reduction plans for vehicles and other industries.
New York Governor Andrew Cuomo announced the tax in March, saying it would help New Yorkers pay for their air quality and help drive economic growth.
A carbon tax is a tax levied on greenhouse gases and includes a price that must be paid at the end of the year.
It is based on a “cap-and-trade” system in which polluters are required to set a limit on their emissions and pay for the carbon price.
The New York City Department of Environmental Protection (DEP) said it expected to collect about $5.5 billion in the carbon levy.
The money would be used to fund the city’s Clean Power Plan, which aims to cut greenhouse gas emissions by about 27 per cent from 2005 levels by 2030.
The plan also calls for the use of energy efficiency and renewable energy, which could help reduce emissions.
The carbon levy is not a direct tax on New York’s residents, which are responsible for about 50 per cent of the emissions.
But it is a levy on carbon emissions, which would have to be paid by New York residents.
The tax would go to households earning less than $80 per year.
“If you’re a New Yorker and you’re in the top 1 per cent in the US, and you’ve got $40,000 in a tax-advantaged retirement account, and the government has put a tax of $20,000 on your $40 million, then you’re going to pay $30 a year,” New Zealand Environment Minister Nick Smith told the ABC.
“So it’s not an immediate tax.”
Opposition Leader Andy Little said the carbon levies were “a bad idea”.
“The New Zealand carbon tax will cost New Zealand a lot more money than it’s worth.
It will make our economy less competitive, it will mean our jobs less secure, it’s going to make our climate worse, it’ll make our cities less safe and it’s an unfair tax on the most vulnerable in our society,” he said.
“We can’t afford a $20-a-tonne carbon tax, and New Zealand can’t even afford a dollar a day.”
New Zealand was the first country in the world to introduce a tax on carbon, and Mr Little said he believed it was “not going to have an effect on our economy”.
He said New Zealand had one of the lowest emissions per capita in the developed world.
“It’s a very expensive, high-risk policy, and we can’t make it cheaper by raising it.
The government can’t be raising prices by a billion a year and then trying to pass the money onto consumers,” he told the BBC.
It’s a bad idea and I don’t expect New Zealand to accept it.” “
I don’t think this will help us.
It’s a bad idea and I don’t expect New Zealand to accept it.”
The New Zealand Herald reported the carbon cost of the tax would total $7.5bn, of which $4bn would go towards paying for the Clean Power plan, which is already one of Mr Smith’s biggest priorities.
It also reported that New Zealand could pay for its carbon levy by closing the coal-fired power plants that it had built in the past few years.
It added that a carbon reduction fund could be set up to help pay for any shortfall in carbon payments.
“This will create a tax credit for people that want to go green,” Mr Smith said.
The ABC has contacted the Department of Environment, Food and Rural Affairs (DEP), Department of Health, and Department of Finance for comment.