Up Sucker Creek

Up Sucker Creek
Photo Courtesy of the Lake Oswego Library

Sunday, November 2, 2014

Will a carbon tax come to Oregon?

Carbon tax, the Cover Oregon of tax reform: Editorial Agenda 2014

In the other part of this split universe, lawmakers who'd gathered in Salem this week for committee meetings received an update, some enthusiastically, on a carbon tax study that will be completed later this year. Thus, even as the Legislature decides how to move beyond the failure of one complex and overly ambitious project, there's talk of effecting what one state industry group has called "the most far-reaching tax change since the founding of the state." It's almost as if Cover Oregon, and its lessons, never happened.

There's a simple explanation for this disconnect. Gov. Kitzhaber signed Senate Bill 306, which mandated the carbon tax study, on Aug. 14, 2013. A month and a half later, on Oct. 1, 2013, Cover Oregon famously failed to launch. The carbon tax update lawmakers received this week is an echo of a political reality that disappeared along with all of those perky and hopeful Cover Oregon ads. You'd like to think lawmakers realize that times have changed, but, well, you never know.
SB 306, which passed largely along party lines, mandated a study of "the feasibility of imposing a clean air fee or tax statewide as a new revenue option that would augment or replace portions of existing revenues." In other words, tax reform, the global warming edition.
This finished study, to be presented to lawmakers by Nov. 15, will be plopped into the midst of a long-running reform effort by Gov. Kitzhaber. If he and his legislative colleagues are still serious about tax reform, they should put the study on a high shelf somewhere in Salem and move on.
Whether assessed at the producer or consumer level, a carbon tax would act like a very specific kind of consumption tax. It would be a tax on energy – the gas you put in your car, the electricity with which you heat your home – that would be determined by greenhouse gas production.

And for what? It's one thing to tax fuel to pay for roads, but it's another to do so for reasons that are more ideological than practical. The harm would be obvious, especially to those with less money. Meanwhile, the effect of such a tax in a single state on global warming would be negligible, and perhaps nonexistent.  

So shelve it. Instead, lawmakers and the governor should continue the long and difficult process of building up the credibility they'll need to sell Oregonians on even a modest tax reform proposal that doesn't include a sales tax of any flavor, let alone something as exotic as a carbon tax.

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