Greening the U.S. tax code gets sadly little attention from green groups.
This morning the Brookings Institution hosted a forum on “Tax Reform and the Environment.” Along with the usual suspects singing the economic and environmental praises of ending subsidies and tax breaks that harm the environment as well as levying some that would help was one William Frenzel — former Member of Congress and current member of the President’s Advisory Panel on Federal Tax Reform.
Mr. Frenzel noted that out of the hundreds of submissions from the public to the panel a grand total of three could be generously described as support for “greening” our taxes as part of a reform package. It’s been nearly 20 years since the last tax reform happened, and I know that in the current DC climate it’s hard to imagine a green shift in taxes, but come on people. Don’t we need to at least try?
As far as I know, no environmental group has set up a generic e-mail for their members to send to the panel. This surprises me. But you can take matters into your own hands by submitting your own suggestions.
According to Frenzel:
“It is late in the game, but late is better than never.” The panel is looking for concrete suggestions and the research to back them up if you have it. Here are two places to get you started on your submission. I’m sure Gristmill readers can add more.
Gilbert Metcalf, one of this morning’s panelists, made two good points that are worth keeping in mind. First, approximately 3 percent of U.S. tax revenues come from “green” taxes. This is the lowest of the OECD countries, which average almost 5 percent of revenues from green taxes. Germany collects 7 percent; the UK collects 7.5 percent; and Denmark collects a whopping 10 percent in green taxes. Suffice to say — and Metcalf said it — we can raise our revenues from green taxes without putting ourselves at a competitive disadvantage with other countries of comparable wealth and development. The second important point Metcalf made is that most green taxes alone are regressive, but an environmental tax reform plan can be constructed that maintains, or even increases, a progressive tax structure. And I’m all for progress.