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The Shell logo sign is seen at one of its gas station next to the current fuel prices display in Westminster, Colorado January 17, 2014. REUTERS/Rick Wilking The Shell logo sign is seen at one of its gas station next to the current fuel prices display in Westminster, Colorado January 17, 2014. REUTERS/Rick Wilking  

California wants to slap a ‘carbon tax’ on gasoline

California lawmakers want to put a carbon tax on gasoline and other vehicle fuels to curb carbon dioxide emissions and fight global warming. Golden State residents already face some of the highest energy and fuel costs in the country, but carbon tax proponents say the tax would go to help mitigate the effects of global warming on the poor.

The Los Angeles Times reported that Democratic state Senate President Pro Tem Darrell Steinberg proposed legislation that would slap a 15 cents per gallon tax on fuels sold in the state which would rise to 24 cents per gallon in 2020. The fuel tax is expected to raise $3.6 billion in the first year and would fund public transit projects as well as a new tax credit for families earning less than $75,000 per year.

Steinberg justified his gas tax increase as aid for the poor, who are most impacted by global warming.

“Climate change is a global problem, affecting humanity without distinction,” Steinberg said in a speech at the Sacramento Press Club. “But its health and economic costs fall hardest on the poor.”

“Those who pollute are among the wealthiest and most heavily subsidized industries today,” he added. “Those who disproportionately suffer from pollution are at the polar-opposite end of the economic scale.”

But it’s unclear how increasing the cost of transportation would benefit the poor. Steinberg’s fuel tax would be added on top of the state’s 71.9 cents per gallon gas tax, the nation’s highest, and the 18.4 cents per gallon federal gas tax. The state also operates a cap-and-trade system for industrial facilities and has a low carbon fuel standard to lower greenhouse gas emissions from transportation fuels.

Californians already suffer from some of the highest gasoline costs in the country. According to AAA’s Daily Fuel Gauge, the average price for regular gas was $3.755 per gallon, higher than the national average of $3.389 per gallon.

California has the highest poverty level in the country, at 23.8 percent, according to the LA Times. These families pay a disproportionate amount of their income on necessities like food, clothing — and energy and fuel especially. So it’s unclear how increasing energy costs would help the poor.

Steinberg argues that the state’s cap-and-trade system could send carbon prices spiking or falling wildly, which would be chaotic. So he proposed a carbon tax for fuels as a “stable” alternative to cap-and-trade.

“A carbon tax is stable,” Steinberg. “A carbon tax is significantly less vulnerable to gaming. A carbon tax is transparent.”

Environmentalists are skeptical of not listing fuels under the state’s carbon tax, saying such a move could undermine the already delicate carbon market.

“Pulling them out actually increases the chance that we’d see price fluctuations in the carbon market,” said Tim O’Connor, director of the Environmental Defense Fund’s California climate campaign. “To implement this would really disrupt the market.”

O’Connor added that carbon taxes don’t put hard limits on carbon emissions like cap-and-trade would, but instead it just makes energy more expensive.

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