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Emissions Tax CP


An emissions tax would be like a carbon tax that the government would issue for every ton of pollutant that’s emitted.

Text: The United States Federal Government should begin an emissions tax as a means of climate adaptation.

Solvency

An emissions tax would also reduce emissions in an upstream way


GAO, 09 (United States Government Accountability Office; the audit, evaluation, and investigative arm of the US Congress; “Aviation and Climate Change: Aircraft Emissions Expected to Grow, but Technological and Operational Improvements and Government Policies Can Help Control Emissions”; June 2009; http://www.gao.gov/new.items/d09554.pdf)

An emissions tax is another market-based policy that could be used to reduce emissions from commercial aviation and other emissions sources. Under a tax on carbon dioxide (or other greenhouse gas), the government would levy a fee for every ton of carbon dioxide emitted. Similar to a cap-and-trade program, a tax would provide a price signal to commercial airlines and other emission sources, creating an economic incentive for them to reduce their emissions. A carbon tax could be applied to “upstream” sources such as fuel producers, which may in turn pass along the tax in the form of higher prices to fuel purchasers, including commercial airlines. Similar to a cap-and-trade program, emissions taxes would provide regulated sources including commercial airlines with an incentive to reduce emissions in the most cost-effective way, which might include reducing weight, consolidating flights, or using more fuel-efficient aircraft.

An emissions tax would be the most cost-effective way to reduce emissions


GAO, 09 (United States Government Accountability Office; the audit, evaluation, and investigative arm of the US Congress; “Aviation and Climate Change: Aircraft Emissions Expected to Grow, but Technological and Operational Improvements and Government Policies Can Help Control Emissions”; June 2009; http://www.gao.gov/new.items/d09554.pdf)

An emissions tax is another market-based policy that could be used to reduce emissions from commercial aviation and other emissions sources. Under a tax on carbon dioxide (or other greenhouse gas), the government would levy a fee for every ton of carbon dioxide emitted. Similar to a cap-and-trade program, a tax would provide a price signal to commercial airlines and other emission sources, creating an economic incentive for them to reduce their emissions. A carbon tax could be applied to “upstream” sources such as fuel producers, which may in turn pass along the tax in the form of higher prices to fuel purchasers, including commercial airlines. Similar to a cap-and-trade program, emissions taxes would provide regulated sources including commercial airlines with an incentive to reduce emissions in the most cost-effective way, which might include reducing weight, consolidating flights, or using more fuel-efficient aircraft.



Solves better than Cap-and-Trade

Emissions tax would be better than cap-and-trade when it comes to social benefits and costs


GAO, 09 (United States Government Accountability Office; the audit, evaluation, and investigative arm of the US Congress; “Aviation and Climate Change: Aircraft Emissions Expected to Grow, but Technological and Operational Improvements and Government Policies Can Help Control Emissions”; June 2009; http://www.gao.gov/new.items/d09554.pdf)

Economic research indicates that an emissions tax is generally a more economically efficient policy tool to address greenhouse gas emissions than other policies, including a cap-and-trade program, because it would better balance the social benefits and costs associated with the emissions reductions. In addition, compared to a cap-and-trade program, an emissions tax would provide greater certainty as to the price of emissions. However, it would in concept provide less certainty about emissions reductions because the reductions would depend on the level of the tax and how firms and consumers respond to the tax.64


AT: Hurts airline industry

Cap-and-trade and emission tax won’t affect the industry at all


GAO, 09 (United States Government Accountability Office; the audit, evaluation, and investigative arm of the US Congress; “Aviation and Climate Change: Aircraft Emissions Expected to Grow, but Technological and Operational Improvements and Government Policies Can Help Control Emissions”; June 2009; http://www.gao.gov/new.items/d09554.pdf)

Both a cap-and-trade program and an emissions tax would impose costs on the aviation sector and other users of carbon-based fuels. The extent to which the costs associated with an emissions control program are incurred by commercial airlines and passed on will depend on a number of economic factors, such as the level of market competition and the responsiveness of passengers to changes in price. Officials of some industry organizations we met with said that because airlines are in a competitive industry with a high elasticity of demand,65 they are constrained in passing on their costs, and the costs to industry likely will be large. The Association of European Airlines reported that airlines will have very limited ability to pass on the costs of the EU ETS. Furthermore, the International Air Transport Association has estimated that the costs to the industry of complying with the EU ETS will be €3.5 billion in 2012,66 with annual costs subsequently increasing.67 Others we interviewed, however, stated that airlines will be able to pass on costs, and the increases in ticket prices will not be large. For example, the EU estimates that airlines will be able to pass on most of the costs of their compliance with the EU ETS, which will result in an average ticket price increase of €9 on a medium-haul flight.68 However, the revenue generated by the tax or by auctioning allowances could be used to lessen the overall impact on the economy, or the impact on certain groups (for example, low income) or sectors of the economy by, for example, reducing other taxes.69



Finally, according to some airline industry representatives, a program to control greenhouse gas emissions would add to the financial burden the aviation industry and its consumers already face with respect to other taxes and fees. For example, passenger tickets in the United States are subject to a federal passenger ticket tax of 7.5 percent, a segment charge of $3.40 per flight segment, and fees for security and airport facilities (up to $4.50 per airport). In addition, international flights are subject to departure taxes and customs-related fees. However, none of these taxes and fees attempt to account for the cost of greenhouse gas emissions, as a tax or cap-and-trade program would do. In addition, the revenue generated from an emissions tax or by auctioning allowances under a cap-and-trade program, could be used to offset other taxes, thereby lessening the economic impact of the program.



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