Green Taxes always hurt the poor & underprivilaged of the society

Few days back the Government of Maharashtra slapped green tax on old vehicles -(Green News – Article – MSN India).

What do they want to do? They want to abolish all the old vehicles plying in the state so that pollution levels decrease dramatically. That is of course a good idea or is it?

Who gets hurt in the process? The poorer section of the society are hurt most. These yellow and black taxis that we see in the picture are mostly owned and driven by poor people who just manages to eke out a living that allows them to live in slums and vulnerable shacks without access to any modern amenities of life like sanitation, water and electricity. Asking them to go for a new taxi is simply a torture and a burden.

The big assumption is that old vehicles pollute. This is entirely wrong. Pollution of any well maintained engine is certainly within the existing pollution norms. And if the norms get tighter then why not ask them to change the engine. No other part of a car actually pollutes. Throwing away a car only for an engine is simply a waste of good money.

Asking people to change old cars actually serves the hidden interest of the car manufacturers and nobody else. The number of cars that get added to the city of Mumbai is the highest in India. But that has now reached a limit of growth. Hence the well calculated move to further the interest of a few businessmen and business houses with an eye to increase car sales. In a way, the Government serves the interest of the corporations rather than the ordinary citizens of the country.

Let us take another example: The Green Tax on Sport Utility Vehicle (SUV) in the UK — An excerpt from Mr. Tim Henry of the UK who retired as Chairman of Wolfson Maintenance, formerly a industrial consulting wing the University of Manchester.

“We like many other people in the UK are being penalized for owning a SUV with about 80% tax on fuel and vehicle tax 10 times that of a minicar. This winter we had a long cold winter with temperatures falling as low as -18 deg C. We live in a hilly area- our house is at 800 ft and the hills rise to 2000 ft. Without our 4X4 we would not have been able to get out as the local authorities failed to keep the roads clear of ice. In Wales in the summer we live about ½ mile from the nearest surfaced road and contend with a rough track that floods in bad weather. We would love to be able to have an energy efficient vehicle but the current route of tax to dissuade is not helpful. It particularly penalizes the poor. Some route of incentives is needed once the energy efficient alternatives are provided.”.

It is clear that Green Tax in any form is not helpful to make things greener. Taxing is not the preferred route to greening — building awareness, encouragement and financial incentive are.

Governments all over the world are getting it wrong.

This reminds me of Peter the Great of Russia. He imposed a stiff tax on anyone wanting to sport a beard. Why? Simply because he did not like it and he wanted citizens of his country to look smarter and more modern like him. But the sad fact was that most of the poor citizens who actually wore a bread did not do so to start off a new fashion. They simply did not have the money to shave regularly. They just wanted to save whatever they could.

No amount of ‘System Thinking’ might help such Governments to see the light of the day. They already have a solid opinion about the whole thing.

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