/PRNewswire-USNewswire/ -- Environmental groups and carbon pricing advocates lauded Representative John Larson (D-CT), who today introduced America's Energy Security Trust Fund Act of 2009, proposing a carbon tax to reduce carbon emissions and fight global warming.
The tax would take effect in 2009 and tax emissions at a rate of $15 per ton of carbon dioxide and increase by $10 each year (or by $15 each year if needed to keep emissions falling fast enough). It would be virtually revenue-neutral, with over 95% of carbon tax revenues used to cut payroll taxes to help Americans with higher energy prices.
"Congressman Larson has shown great leadership in introducing this bill and ramping up the debate on carbon pricing in this Congress," said Charles Komanoff, co-director of the Carbon Tax Center. "It's a debate we urgently need to have. President Obama took a big step forward in proposing carbon pricing in his budget. The strong consensus among economists is that a carbon tax is the quickest, most effective and most transparent approach. Now that we have a well-crafted carbon tax bill to work with (and more such bills in the pipeline), Congress will be able to compare the details of actual carbon tax and cap-and-trade bills, and debate them on the merits. As that debate unfolds, you'll see a groundswell of support and eventual consensus line up behind a carbon tax proposal like Rep. Larson's."
"Representative Larson is making an important contribution to the debate about how to reduce global warming pollution," said Brent Blackwelder, president of Friends of the Earth. "A key part of the solution will have to be a price on carbon. If passed, the bill introduced today by Representative Larson would establish this price, strengthening our economy and helping head off catastrophic climate change, while avoiding some of the pitfalls of previous bills that would have led to windfall profits for corporate polluters."
Unlike cap-and-trade proposals, the Larson bill calls for taxing carbon at the source, such as oil refineries and coal mines for domestic fuel, or shipping terminals for imported fuel. A total of $100 billion over the first 10 years, equivalent to three percent of the revenue, would be dedicated to tax breaks for clean energy, while another $41 billion, equivalent to one percent of the revenue (more in the initial years, less in later years) would be used for transitional assistance for workers in industries directly impacted by the carbon tax.
All of the remaining carbon tax revenue - over 95% - would be spent on cutting payroll taxes, offsetting increased energy prices for working families, and helping stimulate job growth. This would amount to a tax shift rather than a tax increase. In fact, most working families will actually come out ahead if they conserve energy modestly.
As chair of the House Democratic Caucus, Rep. Larson is the fourth-ranking Democrat in the House of Representatives and sits on the Ways and Means Committee, which will have primary jurisdiction over a carbon tax. At a hearing of the Committee held February 25 to compare the effectiveness of a cap-and-trade scheme vs. a carbon tax, NASA chief climate scientist James Hansen said, "This [carbon] tax, and the knowledge that it would continue to increase in the future, would spur innovations in energy efficiency and carbon-free energy sources... Carbon emissions will plummet far faster than with alternative top-down regulations."
America's Energy Security Trust Fund Act of 2009 is supported by Rep. George Miller (D-CA) who has co-signed a "Dear Colleague" letter announcing it. Additional carbon tax measures are being drafted by other members of Congress on both sides of the aisle, including Rep. Bob Inglis (R-SC).