Tuesday
Jun162009
Tax Experts Spar Over “Cap And Trade” Policy
Tuesday, June 16, 2009 at 2:16PM
By Learned Foote- Talk Radio News Service
The Senate Committee on Finance held a hearing to assess what impact the Obama administration’s carbon cap and trade program might have on tax legislation.
The committee’s testimony dealt with a narrow set of questions such as whether or not carbon allocations should be distributed for free or auctioned off, and whether or not carbon allocations should be considered income or capital asset. In addition, the committee debated whether or not previous legislation governing the emission of sulfur dioxide can be used as an analogy to carbon taxes.
A panel of tax policy experts offered contradictory pieces of advice to the committee.
“In considering the direction for the tax treatment of CO2 allowances, the most logical place to start is with the current treatment for SO2 [sulfur dioxide] and NOX [nitrous oxide] allowances. These allowances were established under Title IV of the Clean Air Act Amendments of 1990,” said Keith Butler, Senior Vice President of Tax at Duke Energy. “These allowances should be granted with zero-tax basis and they should not be taxed upon granting it, because that just creates an ultimate cost that I don’t think we need to create,” he said.
“To use that distant stuff from the past for this new market which is so vast is, you know, I mean, why don’t we bring over the laws from Amsterdam and apply them in New York today,” said Gary Hufbauer of the Peterson Institute for International Economics. He added that carbon allocations should be treated as income rather than capital gains, and that following the precedent set by SO2 caps is “mind-boggling.” “What you’re gonna do is throw out a couple hundred billion dollars,” he said.
According to committee chairman Senator Max Baucus (D-Mont.), the SO2 cap governed less than 120 facilities, whereas a carbon cap and trade program would affect over 7,000 entities if enacted. All of the panelists agreed that the analogous legislation would have to be revised if a carbon cap and trade proposal is enacted, and Hufbauer said that a “blank slate” would be most appropriate.
The Senate Committee on Finance held a hearing to assess what impact the Obama administration’s carbon cap and trade program might have on tax legislation.
The committee’s testimony dealt with a narrow set of questions such as whether or not carbon allocations should be distributed for free or auctioned off, and whether or not carbon allocations should be considered income or capital asset. In addition, the committee debated whether or not previous legislation governing the emission of sulfur dioxide can be used as an analogy to carbon taxes.
A panel of tax policy experts offered contradictory pieces of advice to the committee.
“In considering the direction for the tax treatment of CO2 allowances, the most logical place to start is with the current treatment for SO2 [sulfur dioxide] and NOX [nitrous oxide] allowances. These allowances were established under Title IV of the Clean Air Act Amendments of 1990,” said Keith Butler, Senior Vice President of Tax at Duke Energy. “These allowances should be granted with zero-tax basis and they should not be taxed upon granting it, because that just creates an ultimate cost that I don’t think we need to create,” he said.
“To use that distant stuff from the past for this new market which is so vast is, you know, I mean, why don’t we bring over the laws from Amsterdam and apply them in New York today,” said Gary Hufbauer of the Peterson Institute for International Economics. He added that carbon allocations should be treated as income rather than capital gains, and that following the precedent set by SO2 caps is “mind-boggling.” “What you’re gonna do is throw out a couple hundred billion dollars,” he said.
According to committee chairman Senator Max Baucus (D-Mont.), the SO2 cap governed less than 120 facilities, whereas a carbon cap and trade program would affect over 7,000 entities if enacted. All of the panelists agreed that the analogous legislation would have to be revised if a carbon cap and trade proposal is enacted, and Hufbauer said that a “blank slate” would be most appropriate.
Reader Comments (3)
No patriotic and informed American can support the ACES Act (cap and trade), based on the global warming scam.
Cap and Trade “would be the equivalent of an atomic bomb directed at the U.S. economy—all without any scientific justification,” said famed climatologist Dr. S. Fred Singer. It would significantly increase taxes and the cost of energy, forcing many companies to close, thus increasing unemployment, poverty and dependence.
Cap and trade represents huge taxes and cost increases, which will hurt mostly the poor and the middle class. Cap and trade will give dictatorial powers to Obama and will further enrich his billionaire friends (Gore, Soros, Goldman Sachs, Obama’s Chicago Climate Exchange friends, General Electric, the United Nations, etc.) -- all at our expense and at the expense of our children and grandchildren.
Those brainwashed to the point of wanting to destroy the economy to "prevent global warming" are behaving like the most primitive human beings who were duped into believing that human sacrifices would ensure them good weather. Human beings don't have the power to control climate! And killing the economy will not help the environment. Poor countries can’t protect the environment. Just look at Haiti!
More and more scientists and thinking people all over the world are realizing that man-made global warming is a hoax that threatens our future and the future of our children. More than 700 international scientists dissent over man-made global warming claims. They are now more than 13 times the number of UN scientists (52) who authored the media-hyped IPCC 2007 Summary for Policymakers. http://www.climatechangefraud.com/content/view/3562/218/
Additionally, more than 30,000 American scientists have signed onto a petition that states, "There is no convincing scientific evidence that human release of carbon dioxide, methane, or other greenhouse gases is causing or will, in the foreseeable future, cause catastrophic heating of the Earth's atmosphere and disruption of the Earth's climate." http://www.petitionproject.org
We pray that honest leaders – both Democrat and Republican - are able to save us from Obama's criminal ACES Act (cap-and-trade) scam.
[...] Experts Spar Over Cap and Trade Policy Learned Foote - Talk Radio News Service The Senate Committee on Finance held a hearing to assess what impact the Obama [...]
It is time to take action. The American Clean Energy and Security Act will rejuvenate American manufacturing and provide clean, affordable, and limitless energy to the American public. We need to stop quarreling and start acting. Lets strengthen this Act and get it passed.