To get there from here, market distortions created by a failure to internalize externalities must be removed. In other words, we must get the prices right. The single most significant government policy tool to advance or retard economic sustainability resides in the fiscal framework.
Our fiscal plan is straightforward. Use the tax system to help meet societal and ecological goals. Get the prices right. Allow business to pursue profit, with clear signals of environmental and societal objectives.
The Green commitment to Green tax relief will:
Reduce income taxes;
Reduce payroll taxes;
Raise taxes on profits of large corporations to the mid-range of OECD countries;
Recover taxes hidden in off-shore tax havens;
Introduce a carbon price through a carbon fee and dividend system, sending a clear economic signal that wasting energy and resources implies real costs.
According to an editorial in The Economist, September 9, 2006:
“Ideally, politicians would choose the more efficient carbon tax, which implies a relatively stable price that producers can build into their investment plans.”
The carbon fees collected at the well head or coal mine will be paid out to every Canadian on a per capita basis. This will foster the efficient and more sustainable use of dwindling fossil fuels, and it will also serve as a fair and efficient income redistribution mechanism.
The Greens will also eliminate large corporate subsidies and grants programs.
It makes no sense to subsidize the wealthiest companies on Earth to make the world’s most profitable product − a barrel of oil. The 2010 report of the International Energy Agency called for the removal of fossil fuel subsidies. Globally, they amount to over $300 billion a year, while renewables received approximately $30 billion. These perverse subsidies must be removed. It makes sense to reduce taxes on things we want – income and employment – while increasing taxes on things we do not want, like greenhouse gases (GHGs) and pollution that causes smog.
Canadian businesses want two things from their government: predictability and policy coherence. The Green Government will ensure that the rules are clear, the playing field is level, and decision making is transparent.
Key societal goals:
Ensure Canadians have more time for friends, family, and community engagement.
Send the right price signals to the economy. The days of cheap, abundant energy are over. A carbon price will send that signal and promote a shift away from polluting energy choices.
Eliminate perverse corporate subsidies. No more ‘corporate welfare bums.’ No more unpaid ‘loans’ to government granting agencies.