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Quebec Carbon Tax
19/06/2006

An article on the Globe and Mail site says that oil producers are secretly happy about Quebec's carbon tax proposal because they will be able to pass the cost on to consumers and because it will apply equally to both domestic and imported fuel.

Really, I'm surprised that any other option would ever have been considered by anybody.

Meanwhile, Quebec's environment minister says it would be "odious" of the oil sector to pass these costs on to consumers. This is doubly silly. The obvious reason that it is silly has already been talked about by many: of course the companies are going to pass on an added cost of doing business... what else could they do?

But the real reason it is silly is that a carbon tax that doesn't affect prices at the pump is a carbon tax that doesn't change behaviour. Isn't the whole point of a carbon tax that if you tax polluting activities those activities will be reduced?

(The estimated effect is 1.5 cents per litre, which is rather negligible in any case.)

UPDATE: More from Andrew Potter Greenpeace is also confused.


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