Don't Mess With Taxes

Photo courtesy COP28 web page

Around 70,000 participants are expected in Dubai, United Arab Emirates (UAE), over the next couple of weeks to discuss how to limit and prepare for future climate change.

They're attending the 28th annual United Nations (UN) Conference of the Parties, known as COP28. The parties part of COP are the countries that signed the original UN climate agreement in 1992. And their current gathering comes at the end of a year of worldwide extreme weather events and a plethora of broken climate records.

While climate change and human contributions to it are being acknowledged by more people, COP28 is not without controversy. Climate activists say governments are moving too slowly. Those who still question, if not outright deny, climate change argue that some proposed changes will further damage economies.

And, of course, there's the location of COP28.

Oil producer host: The UAE is one of the world's top 10 oil-producing nations, and fossil fuels are among the main causes of climate change. Sultan al-Jaber, president of the COP28 talks, is the chief executive of the state-owned oil company.

And documents leaked just before the meetings began on Nov. 30 showed host UAE planned to use the climate meetings with other countries to promote deals for its national oil and gas companies.

So, will anything actionable be accomplished during the events set to run through Dec. 12? The answer remains to be seen, since at earlier meetings pledges were made and not met.

That's not necessarily good news for a sweltering planet, where dangerous weather systems are intensifying. Yes, looking at you Hurricane Otis, flooding in Libya, and wildfires across Canada.

Taxes and climate change: At the policy level, governments often turn to taxes to try to lessen or ameliorate actions that produce environmental damage.

In the United States, the Inflation Reduction Act signed into law in August 2022 contains a variety of environmental provisions. They include funding, programs, and incentives (yes, tax breaks are among them) to encourage the nation's transition to a clean energy economy and use of new clean electricity resources.

And since taxes are part of, well, everything, they will be explored at COP28. So, global environmental tax coverage earns this weekend's multiple Saturday Shout Outs.

Tax the "bad" polluters: Let's start with a call by a COP28 advisory panel to increase taxes on polluting activities. Such a levy, along with cutting fossil fuel subsidies, according to the group of independent economists.

"We see a big potential, particularly from taxing the bad internationally and using that money to generate predictable resources," panel member Amar Bhattacharya of the Brookings' Center for Sustainable Development told a briefing. The Reuters report on that briefing earns the first Saturday Shout Out.

Shipping taxes, too: A second shout goes to the Business Standard coverage of the COP28 panel briefing. It notes there are growing calls for a carbon levy on shipping, which transports around 90 per cent of world trade and accounts for nearly 3 per cent of the world’s carbon dioxide emissions.

Shipping, other transport levies, and a wealth tax are among the climate change financing options that are part of a Climate Action Network and European Commission study, New resources for public climate finance and for the Loss and Damage Fund: Exploring taxes and levies at EU and multilateral level, which gets this weekend's third Saturday Shout Out. The table below from the study offers some numbers.

New climate tax task force: Such levies also are part of a new international taxation taskforce launched at COP28 by France and Kenya.

French President Emmanuel Macron told the COP28 that his country, Kenya, Barbados, and "several others" will deliver the new task force's climate tax conclusions at next year's G20 summit in Rio de Janeiro, Brazil, according to a New Vision report, aka Saturday Shout Out number four.

COP28 guide: Finally, today's fifth shout goes out to Scientific American's Your Guide to the COP28 Climate Meeting in Dubai. It promises to help us "understand the negotiations and squabbles about money and the 'phaseout' versus 'phasedown' of fossil fuels."

Not to get too provincial, but SciAm's guide has a good section on the American participants, including Vice President Kamala Harris; senior officials from more than 20 U.S. departments and agencies, including special climate envoy John Kerry; and Members of Congress from both sides of the aisle.

OK, that's enough climate tax talk today. I'm going outside to enjoy the clear, 70-degree day here in Austin and worry about the region's severe storms, spring and winter, later.

You also might find these items of interest:

• Home landscaping and tax tips for Earth Day
• Europe tacks on larger fuel taxes than the United States
• A home energy audit could produce lower utility bills and a tax credit
• Faith groups urged to take advantage of new climate-related tax credits

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