Carbon tax to go into effect in B.C. in Canada

The carbon tax goes into effect starting today:

Keep an eye on how things work out in B.C. for an idea of how it might work in other countries. It is supposed to be revenue neutral, which means that there is a decrease in income tax at the same time:

Starting on Canada Day, British Columbians will likely be paying the highest gas prices in the country, as the province's new carbon tax will add about 2.5 cents to a litre of fuel.

Gas is expected to cost over $1.50 a litre.

But Premier Gordon Campbell promises that British Columbians will have more money in their pockets at the end of the year because of income tax cuts.

"Every citizen in British Columbia will have more money in their pockets at the end of this year regardless of where they live," Campbell told CTV Newsnet Monday in response to criticism that his carbon tax plan will cost those living in the suburbs and the north.

The carbon tax starts at a rate based on $10 per tonne of carbon emissions and rises $5 a year to $30 per tonne by 2012. That works out to an extra 2.4 cents a litre on gas, rising to 7.24 cents per litre by 2012.

The people most opposed to the tax of course are people up north that have to rely on vehicles more than those that live in the bigger cities. If I were premier I could see negotiating an agreement whereby half of the revenue goes to tax cuts, and the other half to public transportation with an extra large amount per capita to smaller cities that have the hardest time with a lack of buses and therefore riders.