Energy Tax Provisions Not Doing Their Job

Last updated on June 25, 2022

The energy tax provisions that include bio-fuels provisions, production tax credits for wind, oil and gas depletion allowances, and wind and other renewable energy source provisions are doing little to nothing to reduce greenhouse gas emissions, according to a study sponsored by the U.S. Department of the Treasury.

The findings of the study have revealed that the complexity of the tax code is a factor that does not allow clear determination of the impact current energy tax provisions are having in controlling greenhouse gas emissions.

A simple solution to the problem of the present energy tax provisions proving ineffective in reducing greenhouse gas emissions is to charge direct taxes on greenhouse gas emissions. A carbon tax is expected to have the desired impact on greenhouse gas emissions, but the Obama administration and congressional Republicans are opposed. According to the Obama administration, the President is focused on implementing common sense policies that will lead to a reduction in greenhouse gas emissions.

Presently, if the tax provisions are left untouched, they will be little help to the environment. The U.S. Senate Committee on Environment and Public Works will take up carbon- tax legislation in July.