Policy Forum: Editor's Introduction–-Carbon Taxation and Related Policy Options Kevin Milligan ~ Vancouver School of Economics ~ University of British Columbia

Policy Forum: Editor's Introduction--Carbon Taxation and Related Policy Options

Canadian Tax Journal, Vol. 60, No. 4, pp. 867-868 (2012).
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Abstract:

Many Canadians received their introduction to carbon tax policy through the ill-fated 'Green Shift' proposed during the 2008 federal election. While federal environmental policy development since then has been limited, there has been active development at the provincial level. Initiatives range from a broadly-based carbon tax in BC to sales tax rebates for hybrid vehicles in place in at least five provinces. This Policy Forum gathers together three papers examining developments in carbon taxation and related policy initiatives.

Environmental policies can have an impact on Canadian businesses in at least three ways. First, these policies change relative costs faced by the firm, so production and investment decisions react to the new tax-inclusive costs. Second, regulation imposes compliance costs on businesses, which has an impact on profits and taxes directly as compliance costs are deductible, and indirectly by changing the costs of production and investment. Finally, many of these environmental policies require a careful accounting of emissions, requiring new accounting procedures to keep track. These policies are already changing the business environment, and further developments seem likely.

Versions:

Published version, December, 2012: link.

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