Death and taxes

Nothing is certain, it's said, but death and taxes. Ironic then, that when it comes to the environment, the one could play a major role in reducing the extent of the other - the deaths of millions through disaster, starvation, drought and disease.

Cost is a frequently cited reason for why renewable energy technologies haven't taken off. Yes, they rely on clean, free sources of energy; yes, they're better for people and the environment; yes, they can help create jobs and build new industries, but they're more expensive.

They aren't, of course, if one factors in the indirect costs associated with fossil fuels - the impacts on air, water and soil quality - and if you strip out the significant subsidies received by the oil, coal and petroleum industries.

But until a finite value is attached to things like biodiversity and quality of life, one that affects corporate and personal finances, change will be slow and sputtering.

The other day I received one of many studies on the role of ICT in a low-carbon economy - the type that show the ICT industry could reduce global greenhouse gas emissions by 15% by 2020; that more efficient designs and better connected systems could save oodles of energy, water and unnecessary waste.

Great. So why's nobody doing it?

Ok, some organisations are, but not the majority, not in SA. Why? Because it costs too much, they argue. Because the ROI is lousy and businesses don't get sufficiently rewarded. Because even government tenders don't give IT companies credit for their environmental efforts.

Sure, we need innovation and new ways of designing products and systems, but in order to slow down the huge changes set to arrive in the next century, we need to drastically alter behaviour and consumption patterns.

That's code for “money talks”. Hopes that the carrot would triumph over the stick are quickly fading. Thinking that the promise of reward would fare better than the threat of punishment gives society too much credit, it seems. Only once making a change is actually easier than bearing the costs will Joe average ditch wasteful habits. You can't beat sense into anyone with a carrot, after all.

Environmental tax has seen its share of local column space recently, following government's plans to release a carbon tax policy by mid-year. National Treasury published a discussion document for comment in December, and is busy working through the responses received.

Only once making a change is actually easier than bearing the costs will Joe average ditch old habits.

Lezette Engelbrecht, Online features editor

There have been various objections to the proposed policy, with some businesses arguing government has zoomed in on a tax, while ignoring other financial instruments, such as incentive programmes. But policy makers have stressed that the proposed tax will form part of several measures aimed at trimming emissions, including Eskom's demand side management schemes.

While the intricacies of the tax structure will be pivotal to its efficiency, there's no doubt a tax has to come, and soon. Money is the only thing with enough clout to change people's behaviour. Finger waving doesn't help; moral arguments produce little more than eye-rolls; appeals to reason or the sanctity of nature evoke sentiment, or reflection, but they rarely spur behavioural shifts.

Some will cry foul and argue we already pay enough tax. But in other countries environmental taxes often result in lower income taxes, and when you think about it, what do our taxes really go towards? Safer roads? That's out if they're swept away by flood waters. Support for the poor and elderly? They will face unprecedented hardship due to the effects of climate change. National security? SA will have to cope with migrating populations and scores of environmental refugees.

So, in essence, environmental taxes will help support services already deemed necessary by the majority of the tax-paying public. The environment's role in maintaining society's health, safety, and productivity just hasn't been factored in to full effect before.

The outlined carbon tax policy acknowledges that poor households spend nearly 25% of their income on electricity, water and transport, so it's essential they not carry more of a burden. These communities have, after all, contributed much less to national emissions.

Government has said the revenue stream generated by a carbon tax could be ploughed into developmental programmes - such as the roll-out of free basic services including water and electricity. Ok, we've heard that before, but these issues are at least being addressed.

The point - one the draft policy is at pains to make - is that a carbon tax is the most appropriate means of reducing the country's GHG emissions. It will provide a strong price signal to both producers and consumers, and incentivise more environmentally responsible behaviour over the long term.

As problems of environmental degradation and global warning worsen, the prices of goods will have to take into account the indirect costs of their production. As environmentalist Lester Brown puts it, by ignoring the substantial secondary effects of burning coal, such as pollution, decimated ecosystems and climate change, “the market is giving us bad information. As a result of this and other distortions, we are making bad decisions.”

Other harmful behaviour is priced to take into account the damage it does - cigarettes are taxed, alcohol is taxed, why not the burning of fuels that make the earth less habitable, especially when there are alternatives?

It comes down to choices, and the choices of consumers will determine the extent to which the rest of the world is exposed to environmental devastation, crop failures, drought, illness and suffering.

Death and taxes... they'll come, it's just not clear which will arrive first.