The geniuses at the Congressional Research Service have found that a $20 per ton carbon tax in the U.S. could reduce its budget deficit by 50 percent over the next 10 years.
Strike me dead. Who would have thought that a tax might increase revenue (at least below the revenue maximising carbon tax rate)? Any tax increase (subject to the above caveat) will reduce a budget deficit. The key issue is the efficiency of such a tax increase.
But don’t you like how the carbon tax is being spruiked to reduce a budget deficit? I thought a carbon tax was supposed to reduce carbon emissions and climate change.
But, no. That’s the magic of the carbon tax. Not only does it solve climate change, reduce the budget deficit, and cure syphilis, but it is also promotes harmony, peace and love. A carbon tax is the silver bullet.