Green tax shift
A green tax shift is a fiscal policy which lowers the taxes on income including wages and profit, and raises taxes on consumption, particularly the unsustainable consumption of non-renewable resources.
Examples of taxes to be lowered by a green tax shift:
Examples of taxes to be implemented or increased:
Tax shifting may include balancing taxation levels to be revenue-neutral for government, industry or consumer groups.
Taxes on consumption may take the feebate approach advocated by Amory Lovins in which additional fees on less sustainable products — such as sport utility vehicles — are pooled to fund rebates on more sustainable alternatives — such as hybrid electric vehicles.
The object of a green tax shift is often to implement a "full cost accounting", using fiscal policy to internalize market distorting externalities, which leads to higher efficiency, and sustainable wealth creation.
The policy has been criticised as being neo-liberal for moving the tax burden from the rich to the poor by reducing progressive income tax which emphasise ability to pay and thus tax the rich at a higher rate than the poor, in favour of regressive consumption taxes which tax the rich and poor at an equal rate.
