Initiative 732, carbon emission tax
Washington voters will decide whether to approve the nation’s first carbon tax in November, a measure supporters say would help the state cut greenhouse gas emissions and set precedent for a national climate policy.
But I-732 has failed to gain support from some of the groups that would typically back efforts to reduce carbon emissions. Both the state’s Democratic Party and the Sierra Club have opposed the initiative, saying it isn’t the right approach to climate policy.
Business and labor groups also are lobbying against it, saying I-732 would be a “job killer” that would shift employment to other states and countries.
The proposal is modeled after a similar carbon tax in British Columbia. Supporters say it is a fair, market-driven approach to reducing carbon emissions, spreading costs across both households and businesses. Supporters also dispute Kaiser’s position that the initiative would reduce the company’s global competitiveness. Supporters describe the initiative as a “tax shift” that raises the cost of carbon but mitigates the effect on manufacturers and Washington families, who would pay more for gasoline, heating fuel and electricity.
Under I-732, each ton of carbon produced in Washington would be taxed by $15 beginning in July 2017. The tax would increase to $25 per ton the next year, and would rise annually until it hits a maximum of $100 per ton.
Washington residents would see a 1 percentage point drop in the state’s sales tax over two years if the initiative is approved and manufacturers paying the new carbon tax would get a break on the state’s business and occupation tax, though some business leaders have said the cut in the B&O tax would not be enough to cover the new carbon tax.
Initiative 732 proposes a carbon tax and frames it as an economist would: If you want less of something, tax it. So it taxes carbon and lowers the sales tax to achieve a roughly revenue-neutral result. As a result, carbon would finally have a price, which would temper its use and make energy alternatives more competitive, and the state could become a model for lowering greenhouse gas emissions. Consumers would see the tax at gas pumps and in their power bills. They’d get a break of 1 percentage point in the state sales tax.
The more taxes we pile on businesses, the more likely we are to see them head east to Idaho or states with far fewer restrictions on carbon emissions.
The cost of doing nothing outweighs any cost of implementing I-732. The state’s own estimates
Three of six ballot initiatives in the November election would fail if voting were held today, a new poll suggests.
The Legislature should put an alternative to I-732 on the ballot to fix an inadvertent flaw.
By establishing a carbon tax and lowering the sales tax, Washington state can be at the forefront of addressing the long-term consequences of climate change.
Supporters of a carbon tax say they have enough signatures to send Initiative 732 to the Legislature next year.