Economic analyses of various carbon-tax proposals consistently show they would harm all Americans and would be detrimental for the U.S. economy. A carbon tax would burden businesses with unnecessary costs, making them less competitive in the global marketplace. All this, and much more, is why Congress passed a resolution in 2016 rejecting carbon taxes.
A standalone tax on carbon-dioxide emissions would have a disparate impact on the poorest Americans, because they spend a greater portion of their incomes on energy and energy-intensive products compared to upper-middle-class and relatively wealthy Americans. CLC recognizes this, so to avoid punishing the poor, carbon-tax proponents promise to rebate the revenue generated by the tax back to the public.
CLC’s plan would begin with a carbon tax rate of $40 per ton. At that rate, CLC says a family of four would receive approximately $2,000 as part of its carbon refund in the program’s first year. CLC brags the bottom 70 percent of Americans under its plan would receive more in refunds than they would pay in increased energy costs.
That’s great — unless you are one of the people that fall in the 30 percent that would pay more for energy without getting a full rebate. Since the rebate is aimed at eliminating the tax’s regressive impact on the poor, we can only assume the poor would get a greater proportion of the total rebate funds while the middle class and relatively wealthy would pay more than their fair share.