Rethinking Green Taxation

I have just received a copy of a letter from the former LibDem MP for Guildford explaining her party's views on Green Taxes.

The problem with this approach (you can read more about it at www.greentaxswitch.com) is that, whilst the concept seems to be pressing the right buttons, the content is rather more problematic.

The Conservatives are also espousing a greener tax system but have not yet completed their review and - perhaps more fiscally responsibly - will not say what specific tax policies they will introduce until nearer to an election, when they will have a better idea of what the economic circumstances are.

My problem with politicians using environmental issues and taxation interchangeably is that they so often get it wrong.

Let's look at recycling where Government legislation means that Local Authorities are causing an increase in packaging by pushing low cost recycled paper at the market - why? because if they don't, Government will fine them... So, it's cheaper to pay to have the paper recycled. Can this be why we seem to find more and more packaging on our supermarket goods? Is this what was intended?

What about airline travel? Gordon Brown has imposed an additional tax per ticket bought. This may reduce the number of tickets bought but won't necessarily reduce the numbers of flights... So, planes take off with more empty seats than before and the environmental cost per passenger actually increases. Flights should be taxed not the individual passengers. This would encourage fewer flights but ensure the airlines worked harder to fill them.

Woking Borough Council has embraced Combined Heat and Power amongst its buildings to reduce its impact on the environment. Other local authorities, Guildford included, are a long way behind. There must also be scope for the Cathedral, University and Hospital to share some of the benefits of CHP. By way of example, the Royal Surrey County Hospital spent more than £1.75m on utilities in the first 8 months of the fiscal year.

Launching a green tax has plenty of negative sides. We have plenty of legacy industries which occupy premises that are older and less efficient than the ideal standards. Can our industries afford to just pour money into this issue whilst their competitors build new facilities in other countries? What is the environmental consequence of tearing down older facilities and building new? Is there a clear pay back in financial and/or environmental terms?

The idea of imposing a massive tax on new cars will slow down the rate at which we as a society change to more modern, less polluting cars. Car manufacturers are already a long way advanced down the road of cleaner, greener fuels (take the Saab Bio range, for example) but the process needs to be encouraged by a more effective use of the carrot and not through wiedling a big stick!

It is time to change behaviour, yes; it is not, however, the time to panic people into accepting political solutions to practical problems. Let's have an intelligent debate about the whole life-cycle cost (in both financial and environmental terms)of the various practices processes and products we love to hate.

Plastic bags (I hate seeing them littering the hedgerows, etc) are a by-product of the oil industry. What would happen to that particular by-product if there were a ban on polythene bags? There is probably a very easy answer to this but what I am saying is that we need to look at the whole picture.

On the other hand, what about hydrogen fuel for cars. Apart from the obvious problem of having no distribution network, the fuel burns and gives off only water as its by-product - no exhaust fumes, CO2 etc. But... what does it actually cost in environmental terms to produce the liquid hydrogen in the first place?

We are more ready to accept a tax soultion than ever before, but the solutions are not ready for us yet. Talking the talk is not enough. Walking this LibDem talk would probably be a disaster.