A report released yesterday by the think tank Sustainable Prosperity, shows that BC's carbon tax has successfully reduced fuel usage while not affecting GDP growth. Here are the main highlights from the report:
- Since the carbon tax took effect (July 1, 2008), BC’s fuel consumption has fallen by 17.4% per capita (and fallen by 18.8% relative to the rest of Canada).
- These reductions have occurred across all the fuel types covered by the tax (not just vehicle fuel)
- BC’s GDP kept pace with the rest of Canada’s over that time.
- The tax shift has enabled BC to have Canada’s lowest income tax rates (as of 2012).
- The tax shift has benefited taxpayers; cuts to income and other taxes have exceeded carbon tax revenues by $500 million from 2008-12.
The report is based on four years' worth of data and in a CBC article, the authors caution that it is not entirely certain that these successes can all be positively attributed to the carbon tax. However, the evidence is compelling, as the authors state.