Tuesday, April 23, 2019
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The golden opportunity to look at the carbon tax?

Fuel pump illustration. – Sébastien Salom-Gomis / Sipa

  • As a result of the crisis of "yellow vests", the carbon tax is now blocked at 44 euros per tonne of C02 when the government planned to increase it on 1 January like every year until 2022.
  • But this tax, presented as a powerful tool in the service of the ecological transition, still exists. The great national debate, which runs until March 15, leads to look into its future.
  • The Climate Action Network, like the economist Christian de Perthuis, invites to maintain it, while accompanying it with redistributive mechanisms to make it more socially just. Explanations.

Here is the carbon tax. Brunette Poirson, Secretary of State for Ecological and Solidarity Transition, and
 Stanislas Guerini, delegate general of the Republic in motion, have both called in recent days, to put on the carpet the trigger of the crisis of "yellow vests" with all the tweezers imposed by this subject very slippery.

A reiterated call this Wednesday again in a forum published in Le Figaro and signed by 86 deputies from various parties. "This is not the return of the carbon tax as it was considered and that was the drop of water or the spark that launched this mobilization of" yellow vests ", details Mattieu Orphelin, MP ex-LREM at the origin of this platform. It's a call for global reflection [à mener dans le cadre du grand débat national]how can we have an ecological tax more just socially. "

Introduced in 2014 at a price of seven euros per tonne of CO2, this carbon tax reached, in 2018, 44.6 euros per tonne of C02 and was to rise to 56 euros on January 1, 2019 before Edouard Philippe suspended and annulled this new rise against the backdrop of growling yellow vests.

"Not deleted but blocked at 44 euros"

"We are here today, says Meike Fink, responsible for" fair climate transition "at Climate Action Network (RAC), which brings together 22 environmental associations. This carbon tax has not been removed, but remains blocked at 44 euros while the government had planned to increase it from 10.40 euros each year until 2022. "At that date, it should therefore reach 86 euros the ton of CO2.

What impact on the wallet of the French? Hard to say as this carbon tax is not very visible. "It was incorporated into the TICPE (Domestic Tax on Energy Consumption), a tax introduced in 1928 on petroleum products when they are intended to be used as fuel or heating fuel," says the economist Christian de Perthuis, founder of the
Chair in Climate Economics at Paris Dauphine University. So it's gasoline, diesel, domestic fuel, natural gas.

This TICPE weighs about 60% of the price of diesel and diesel at the pump. "That's about 60 cents for diesel and 68 cents for gasoline in 2018," says Christian de Perthuis. On these amounts, the carbon tax represents only a few cents. Twelve for carbon and ten for gasoline. "

Painless until 2017

In other words, this carbon tax can be easily painless especially if, at the same time, the price of a barrel of oil falls. And that's what happened when it came into force in 2014. "Between the time this carbon tax was reflected and when it was applied, the price of a barrel of oil rose from $ 100 to $ 40. , so that the tax was largely offset by the fall of the course and the French have long paid without realizing it, "continues Christan Perthuis, who chaired in 2013 the Committee for ecological taxation whose work has resulted in the introduction of the carbon tax.

A context that has allowed successive governments to harvest this new recipe without explaining why this carbon tax and its mechanisms. The situation has changed. the barrel of oil is on the rise again. In parallel, when he arrived at the government, Nicolas Hulot wanted to accelerate the revival of this carbon tax associated with a complete catch-up of the taxation of diesel on that of gasoline. In short, the carbon tax now jumps in the eyes of many French, feeling expressed by Priscilla Ludosky in
his online petition at the origin of the challenge of "yellow vests".

A powerful tool for ecological transition?

Good for Christian de Perthuis. "This protest movement brought the issue of the carbon tax to the public square," he says. Because it has its pitfalls that deserve to be debated.

"It weighs more heavily on low-income households," says Fink. It all depends on how households move and heat themselves, but we estimate that a carbon tax at 56 euros per tonne of C02 would have an average cost of about 270 euros per year for a French household. An amount that does not have the same impact depending on whether one belongs to the 10% of the richest households or the 10% the poorest. "Moreover, it is these wealthier households that have the most easy access to carbon-free energy and can thus be less exposed to this carbon tax," adds Christian de Perthuis.

Nevertheless, the Climate Action Network makes the carbon tax a powerful tool at the service of the energy transition, encouraging change in behavior to reduce its dependence on fossil fuels. He then proposes to resume the increase in this carbon tax from 2020 to exceed 100 euros in 2025. "But this time with accompanying mechanisms to make it just socially, insists Meike Inke. The RAC is already asking to increase the share of revenues generated by the carbon tax allocated to financing the energy transition. "Of the 10 billion released in 2018, only 1.8 went to financing renewable energy, said mid-November in 20 minutes Kevin Puisieux, Head of Economy and Finance at the
 Foundation for Nature and Man (FNH). The rest went to the general state budget. "

"Accompany the carbon tax of redistribution mechanisms"

"It is nevertheless essential to reinforce financial aid for the renovation of housing and to develop cleaner mobility," Meike Inke adds. And since these alternatives are not yet all available, we also ask that another part of the revenue from the carbon tax be redistributed to the poorest households. Via tax credits or checks for non-taxable households. The idea is that for half of the French population, this redistribution is greater than the annual costs of the carbon tax for households. "

The Climate Action Network should submit in the coming weeks this proposal that it works with several economists and associations and thus feed the big debate. In mid-January, François de Rugy, minister of ecological transition, had assured that the future of the carbon tax would be decided during this national consultation that runs until March 15. Christian de Perthuis calls for a much more ambitious tax reform [qu’il détaille ici], To rhyme carbon tax and purchasing power. Until put on the carpet the question of the minimum income of existence a little mentioned during the last presidential. The second good point that the economist gives to the "yellow vests" movement.

"It is in emergencies or severe crises that we can often make tax reforms that are unthinkable in calm weather. Sweden introduced its carbon tax in 1991 in a context of unprecedented crisis related to financial crashes. It has reached 120 euros per ton of CO2 in 2018, without today being questioned.


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