The following bill is part of a comprehensive economic plan detailed in the book “Resuscitating America – An Independent Voter's Guide to Restoring the American Dream.” All quotes below are taken from that book with the author’s permission.
The purpose of this bill is to insure that all Americans are contributing to the funding of the federal government (paying taxes), and that prices of traditional energy sources more truly reflect their cost to society.
“All (traditional energy) sources (coal, natural gas, hydro, nuclear, petroleum, etc.) would be taxed at a base rate of 51.5 cents per million BTUs (MMBTU) in the first year. Refined petroleum products would have an additional 68.5 cent per MMBTU tax, for a total of $1.20 per MMBTU. These same amounts would be added to the tax each subsequent year, so that the tax would double in year two, be triple the base rate in year three, and so on, for ten years. By the tenth year, the rate on all energy sources would be $5.15 per MMBTU, with the exception of refined petroleum products, which would have a rate of $12 per MMBTU.”
Hydrocarbon “feedstocks” would also be taxed. These “feedstocks” are used in the production of petrochemical products. “Our use of these petrochemicals in soaps, detergents, pesticides, and fertilizers is unnecessary, and including them in the tax would provide an incentive to move toward ingredients that cause fewer health and environmental problems.”
“In the first year, the tax would translate into an average of $6.50 of tax per barrel of oil, or roughly 15 cents per gallon of gasoline. It would add anywhere from $7.20 to $12.90 to a short ton of coal, depending on the type of coal. Since that much coal produces about 1,819 kilowatt-hours (kWh) of electricity (once again, depending on the type of coal and the type of plant burning it to produce electricity), rates on coal-produced electricity would increase by less than a penny per kWh.” By the tenth year, this bill would add roughly $1.50 to a gallon of gasoline.
The increase in costs of all traditional energy sources would drive efficiency and encourage the move to alternative, more sustainable, forms of energy. All of this would be done without increases in government bureaucracy or subsidies. An energy tax insures that all Americans are paying taxes (just as a consumption tax would), but provides greater energy and environmental benefits than a straight consumption tax.
This bill should be combined with the Income Tax Reform and Simplification Act and the American Fair Trade Act to revive the economy and make it more robust and sustainable.
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