EAI Launches Carbon Tax Radio Ad

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What You Need To Know About The Carbon Tax

A coalition of 15 left-wing organizations led by VPIRG and the Conservation Law Foundation, calling itself Energy Independent Vermont, is proposing that Vermont institute a “Carbon Tax” of $35 million to $700 million annually (ramped up over 15 years) on things such as gasoline and home heating fuel, diesel fuel, natural gas, propane.

According to the group’s proposal, 10% of the proceeds of this tax would be used to subsidize renewable energy businesses. A portion (13%-14%) would be remitted to the bottom 20% of households based on income to “make them whole.” The rest would be allocated to “households, businesses, non-profits, local governments and state government” at the discretion of the legislature.

COST: The Carbon Tax would cost taxpayers a total of $35 million ($50 per ton) in its first year, 2016, and escalate every year to a $700 million ($150 per ton) by 2030.

The group’s report calculates such a tax would impose an additional 45¢ to $1.35 tax on gasoline. One assumes a similar effect on home heating fuel, etc.

The tax would exempt electricity, such as that generated by coal burning power plants, which is dealt with separately under the Regional Greenhouse Gas Initiative (RGGI), as well as firewood and other biomass.

POTENTIAL IMPACT. This tax would hammer the middle class. Households earning more than roughly $25,000 per year (the top four income quintiles) would shoulder the bulk of the burden as businesses would have no choice but to pass the added costs onto consumers wherever possible.

Working Vermonters who commute to a job would be hit hard. Census data (2006-2010) calculated the average commute time for a Vermonter’s is 21.5 minutes each way (though this includes all commuters, not just drivers.)

Such a massive discrepancy in gasoline prices between Vermont and boarder states not subject to this radical level of taxation would provide yet another incentive to cross the boarder to shop. (A savings of $6 to $24 per fill up, assuming an 18 gallon tank.)

CRONYISM: The REMI report cited by Energy Independent Vermont was paid for by “The Blittersdorf Family Foundation, the John Merck Fund, Matthew Rubin, and Barbarina Heyerdahl.” (Page 4, REMI Report, bold added.)

David Blittersdorf is president of All Earth Renewables (he is also a major donor to Peter Shumlin, and the largest individual donor to Shumlin in his first gubernatorial campaign), and Mathew Rubin has significant interests in wind and hydro facilities. These folks could stand to reap millions in state subsides for their projects funded by Carbon Tax revenues. And that is really the point of all this.

According to the REMI study, 10% of the Carbon Tax revenue would go to renewable energy projects. That would mean $3.5 million the first year (at the $50 rate) to as much as $70 million fifteen years out (at the $150 rate). Quite a windfall for wind farms.

David Blittersdorf has a track record of using government policy and his relationship with the governor to steer subsides into his coffers. In 2010 Blittersdorf “got $4.3 million in tax credits from the state’s Clean Energy Development Fund after serving on the fund’s board, a position to which Shumlin appointed him….” (AP, 9/7/10) In 2011, VT Digger reported, in a story titled, “VTGOP: Energy Fund Plan Would Give Blittersdorf Unfair Advantage” that, “Of the total available grant money — $4.4 million — Blittersdorf is eligible to receive $2.2 million.”

Both Blittersdorf and Rubin are closely connected to VPIRG.

{ 5 comments… read them below or add one }

Fred McCullough January 5, 2015 at 4:41 pm

So,,, 23-24% of this money has a designated home. Who knows how creative they can be with the other funds? I’ll bet it will be put somewhere that will shore up the lefts power position. More crony capitalism and more money to soak from the masses. This is just MORE wealth redistribution that has already taken incentive away and broken the middle class’s spirit. Not much fun doing business in Vt. and I will start actively researching moving my business if this gains any traction.

Reply

jim bulmer January 10, 2015 at 1:47 am

Hey VPIRG, get real. Vermont’s carbon foot print amounts to one drop in the Pacific Ocean. Go pedal your garbage else where.

Reply

John Smith January 13, 2015 at 9:47 pm

Liberal millionaires trying to get more money out of the working class.Enough already! NO MORE TAXES!!! We’ve had it up to here!!!!!

Reply

Harry Byrd January 26, 2015 at 12:50 pm

Get a good supply of U-Hauls ready if this passes. Hopefully we can find a sucker to buy the house before they hear about this. Cannot a person buy stock into these renewable energy companies? It would be cheaper. Oh wait, nobody wants that stock! Thus a tax!

Reply

forbes August 9, 2015 at 12:36 pm

Don`t question and vote in 2016 and You can be guaranteed the results of this pipe dream!

Reply

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The Ethan Allen Institute is Vermont’s free-market public policy research and education organization. Founded in 1993, we are one of fifty-plus similar but independent state-level, public policy organizations around the country which exchange ideas and information through the State Policy Network.
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