[ken]

Companies don't pay taxes for fun, either. What I think that comment is referring to is the fact that corporations have a history of being really good at weaseling their way out of paying taxes, and the bigger companies are the best at it.

A carbon tax, in particular, looks like it would be very easy for a multinational to escape. It's reason #{xyz} to move your facility across the border and out of American jurisdiction.

If we can't get them to pay taxes already, won't a carbon tax simply be yet another tax which is disproportionately paid by small businesses and individuals, and not the actual biggest polluters, while driving more manufacturing jobs overseas to countries which don't have such laws?

[amelius]

I guess the solution here is to have customs duties based on emissions taxes paid in the originating country. This is not only needed to prevent corporations from moving their business elsewhere, but also to compete with existing/new corporations in foreign countries.

[Pxtl]

That's actually part of Nordhaus' recommended carbon pricing policy. (Nordhaus wrote the book on carbon pricing and won a Nobel prize in economics for it).

The idea is that carbon-priced countries get together and form an internal free trade agreement, and tariff carbon-intensive goods from outsiders.

Because of the political complexity of implementing this, Canada has gone a different way to keep businesses from being uncompetitive against foreign non-carbon-taxed businesses.

Canada uses "output-based allocation" where a relatively green business in an industry is used as a baseline. That is set as a target - create X unit of product with Y units of carbon emissions, and your carbon emissions are untaxed. Every carbon emission over Y is taxed.

In this way, a comparatively green business within a dirty industry can still compete with foreigners, but for a dirty business, the marginal value of going green is just as high as if there was no exemptions at all.

It's not ideal. It's bureaucratic, tedious, economically suboptimal, and politically complicated since it seems unfair. But it's a good intermediate solution until Nordhaus' full dream could be realized.

The money is rebated directly to citizens in federally-regulated provinces.

Conservatives hate it all anyways because their carbon plan is "no."

[sokoloff]

You can't base duties just on emissions taxes paid. (Setting aside practical record-keeping concerns,) If factory A pays no emissions taxes paid because they're based in a country without carbon taxes and factory B pays no emissions taxes because they're in a country with no carbon taxes but also are using carbon-free energy sources and factory C is located in a country with carbon taxes and pays those taxes, should we charge B the same as A in duties? Should A pay more than C by the exact amount of the carbon taxes? If C implements an energy efficiency program to cut its consumption in half, should A now pay less? How could B "prove it"? How do we control such that A can't represent itself as B?

At some point, these other countries are sovereign entities, and it's going to be difficult to dig into the on-the-ground facts at each factory and step along the supply chain to determine emissions.

[amelius]

We can measure CO2 emissions from space:

https://climate.nasa.gov/climate_resources/99/graphic-measur...

If company X in country Y wants to trade with the US, they could require that country Y provides full transparency in carbon emissions, where the measurements from space could be used as a checksum.

[sokoloff]

Neat tech. (For those curious, it seems like we are capable to measure CO2 increase or decrease to an uncertainty of approximately 0.3% [of CO2, meaning ~1ppm overall]. That's impressive.)

Even if the last "embargo uncooperative countries" strategy were possible, I think you'd find that all of their domestic production would be carbon-intensive and their exports would all be "carbon neutral".

[amelius]

Well, we could require that countries (trade partners) pay tax on their emissions as opposed to companies. How these countries tax their companies internally could be an internal affair entirely. And this also solves the bookkeeping at the border.

[adrianN]

Well, if the countries don't want to implement a carbon tax of their own, products from their country will be more expensive, regardless of how carbon neutral they are. That should put pressure on them to get with the times and implement the tax.

[jwalton]

Import tariff?