Archive for the ‘Energy’ Category

Taxes and Energy Policy

Last week I had the opportunity to testify before two Ways and Means subcommittees–Select Revenue Measures and Oversight–about the way our tax system is used as a tool of energy policy. Here are my opening remarks. You can find my full testimony here. As you know, our tax system is desperately in need of reform. It’s needlessly complex, economically […]

The Coming Payroll Tax Role Reversal

In a couple of weeks, President Obama will ask Congress to extend this year’s payroll tax cut. It will surely become a classic Washington double-reverse rhetorical moment. I can’t wait to hear Obama lift some of House Speaker John Boehner’s (R-OH) best lines about the folly of raising taxes in the midst of an economic […]

The GOP, Ethanol, and the No-Tax Pledge

A majority of Senate Republicans yesterday took a symbolic but hugely important vote to eliminate $6 billion in tax subsidies for the production of ethanol.  And, so far at least, they have not turned into pumpkins. The symbolism of their vote should not be underestimated. In a small but important way, 34 GOP senators proved to […]

Carbon Taxes: The Levy (Some) Conservatives Love

You know the Washington Rule: Liberals will never support spending cuts and conservatives will never back tax increases. Yet, there is one new levy that at least some on the right do support—a carbon tax. Backing for this idea has popped up in some interesting places. Most recently, the American Enterprise Institute included it in a […]

How Should We Tax Climate Change Permits?

Now that the House has decided to give away, rather than auction, most CO2 emission permits, I’ve been wondering how Treasury is going to tax this windfall. There is a huge amount of money at stake–by some estimates more than $100 billion-a-year in emissions permits.
Remember, how they would work: Congress would turn the right to emit CO2 into a valuable, saleable asset. Into, one might say, money. The companies that receive these permits—mostly big producers or generators of fossil fuels such as oil refiners or utilities—could either use them for the right to pollute or sell them.

Will Obama Regret the House’s Cap and Trade Give-Away?

During the presidential campaign, Barack Obama and John McCain profoundly disagreed on many issues, among them climate change legislation and the tax treatment of health care. Now, President Obama seems to be bowing to one of McCain’s poor ideas while resisting one of his better proposals.
It is funny how the politics of these issues is playing out. Many economists agree that McCain had the right idea on health care—the Arizona senator proposed replacing the current exclusion for employer-sponsored insurance with a generous tax credit. Yet, Obama continues to resist (though with increasingly less vigor) any change in the tax treatment of insurance.

Ethanol Subsidies: It's Not Easy Being Green

It seems TPC has gone green. Len Burman has told us what he thinks of the bike subsidy (not much) and Rosanne Altshuler has struggled to figure out what tax breaks she can get for installing energy efficient windows.
Not to be outdone, here is my own contribution: Big tax subsidies to encourage production of ethanol have helped yield two results: They have contributed to an increase of as much as 15 percent in the cost of food, and they have produced no measurable reduction in auto-related greenhouse gas emissions. Oops.

Re-cycling stupid tax tricks

As a bike freak and a tax geek, you’d think that I’d be thrilled about the new tax break for qualified bicycle-commuting reimbursement. I’ve been riding my bike to work for 30 years, so this new tax expenditure has my name written all over it. The biker in me wants to cry out, “It’s about time!” But the tax geek just groans.

What’s a Green Consumer to Do?

It’s never too early to plan for next year’s taxes. Let’s say you’re thinking about doing some energy-saving home improvements soon and want to know what federal tax credits are available and how they work. How would you find out?
You might try the IRS website. I did but, unfortunately, couldn’t find any information about energy credits for 2009.

Energy Taxes and the Detroit Bailout

If there are any ranches in Detroit, President Obama has just bet one on his yet-unborn plan to cap greenhouse gasses. Obama has effectively ordered GM and Chrysler to build more fuel-efficient cars in return for billions more in federal bailout money. But will enough people buy those cars with gas at $2-a-gallon to make this a successful strategy?