Tuesday, May 12, 2009

Climate Change Legislation To Generate $624 Billion In Tax Revenue

Earlier today I came across this interesting article on Examiner.com discussing the revenue Barack Obama’s climate change legislation could bring to the US in the next 10 years. I’ve included a snippet of their post below, but the full text can be found here.

The climate change legislation proposed by the Obama administration would generate $624 billion in revenue for the federal government over the next 10 years according to the administration's 2010 budget proposal. The cap-and-trade plan – or cap-and-tax plan as some call it – would place additional tax burdens on industry in the form of carbon emission fees.

Proponents see the measure as a way to help reduce carbon dioxide and greenhouse gasses which they view as the primary cause of global warming. Opponents on the other hand argue that those increased taxes will simply be passed on to consumers and result in a loss of jobs at a critical time in our weak economy.

According to the White House the bulk of the revenue would be returned to consumers by making permanent the tax credit Congress enacted earlier this year as part of the stimulus package. That credit resulted in a savings of $8 per week for the average American taxpayer. Other parts of the revenue would fund research and development of clean energy and climate science.

President Obama is hoping to have a deal in place on the climate change legislation before the Intergovernmental Panel on Climate Change’s (IPCC) meeting in Copenhagen in December. However, the measure is receiving no backing from Republican lawmakers and many Democrats are no longer in support of the legislation. John Dingell, a Democratic Michigan Congressman said, “Nobody in this country realizes that cap-and-trade is a tax – and it’s a great big one.”

Those opposed are concerned about the cost to consumers as industry will almost certainly pass on the cost of meeting the requirements of the cap-and-tax. The U.S. Chamber of Commerce recently studied the measure and determined it would cost each household $1,400 per year and result in 1.9 million in job losses. Other estimates have ranged to as high as $3,000 per household and all far exceed the $8 per week tax credit the legislation would give consumers.

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