Carbon tax initiative may cost and save

by: Essex Porter Updated:

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SEATTLE - In Washington state, the bulk of greenhouse gases come from vehicles burning carbon-based fuel, including gasoline.           

Initiative 732 is designed to limit the use of carbon-based fuels by taxing them $25 a metric ton.

To compensate, consumers would get a penny off the sales tax, and manufacturers would get a big break on their business taxes.

“It's a smart way forward to address climate change. That's going to benefit us, our economy and our children and grandchildren,” said economist Yoram Bauman, founder of the Carbon Washington campaign.

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Advocates filed another 100,000 petition signatures with the Secretary of State Wednesday—almost assuring the initiative will go on the ballot next November, if the legislature refuses to pass it into law.

Supporters claim the tax will be revenue-neutral, but an analysis by state legislative staff showed a $675 million loss.

“That's a preliminary analysis, and we think that those numbers are not correct,” Bauman said.

For example, the campaign disagrees with how the state is estimating tax revenue from coal-fired power plants.

Supporters say the carbon tax would add 25 cents to the price of a gallon of gas.

Drivers we met at an Olympia gas station are still thinking about whether the sales tax cut would be a fair trade.

“I haven't educated myself about this particular initiative and I'd like to do that first,” said Monique Anderson.

“I don't think that it would necessarily incentivize people to drive less, especially with lower gasoline prices,” said Brendan Wood.

The Association for Washington Business says it will be reviewing the initiative closely to see if it will increase costs to consumers and businesses despite the tax break.

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