Tag Archives: adjustment

A tangle of carbon taxes

A big storm on the horizon… get ready for it

Border tax adjustments (‘carbon tariffs’) are inevitable once mandatory carbon taxes or emission caps with market value are applied to production. Now, the Obama administration acknowledges that:

“Mr. Chu, speaking before a House science panel, said establishing a carbon tariff would help ‘level the playing field’ if other countries haven’t imposed greenhouse-gas-reduction mandates similar to the one President Barack Obama plans to implement over the next couple of years. It is the first time the Obama administration has made public its view on the issue” Extract from Wall St Journal

The border adjustment of taxes by means of a ‘carbon tariff’ is not a problem in itself. Border adjustments for VAT and consumption taxes are a longstanding GATT/WTO system that has been un-controversial since the 1970s. The biggest problem is a political problem posed by international legal concepts of equity and responsibility that are bound to cause bitter conflict between governments long before any system of ‘carbon tariffs’ is put in place.

Automobile tariff cut irrelevant

Trade-weighted index australian dollar 2008

Why it’s impossible to get too excited about the planned cut in automobile tariffs from 10% to 5% in 2010. Despite the howls of capital and the unions, the volatility of the Australian exchange rate makes a 5% margin irrelevant. Already in 2008 the trade-weighted index has fallen more than 7 percent. Click the thumbnail for a larger image.

 

EC-China textile ‘circus’

Two highly experienced analysts nail the problem with the possible EC-China agreement on the ‘temporary’ quotas imposed by the European Communities on competitive garment imports. The nonsense about ‘temporary’ quotas and industry adjustment that never takes place has been going on for forty years. Joe Francois and Dean Spinanger point out that we should all […]