Ross Gittins: How about a Robin Hood carbon tax to combat climate change?

In the absence of a carbon price, polluting coal-fired electricity has an undesirable price advantage over non-polluting renewables electricity. This is the economic justification for government subsidy schemes for renewables electricity and household solar power systems.

But Holden and Dixon remind us that, if we introduced their Robin Hood carbon tax, those subsidies would no longer be needed, saving governments (and often, other power users) about $2.5 billion a year.

Ross Gittins

Ross Gittins, Economics Editor of the Sydney Morning Herald gives his take on the Australian Carbon Dividend Plan in this article.