Carbon gas tax would allow Washington state to reduce sales tax by 1%

PULLMAN, WA - Members of a group called "Carbon Washington" are hoping to put a measure on the November 2014 ballot that would make polluting more expensive.

Supporters said putting a carbon tax on fossil fuels would allow Washington state to reduce sales tax by one-percentage point, fund the working families sales tax rebate, eliminate the B&O business tax for manufacturers and increase the small business B&O tax credit.

"Stand-up Economist" Yoram Bauman recently spoke about the carbon tax at Washington State University.

"We think that on net, it's going to balance out," said Bauman. "The objective is not to increase government revenue, or to reduce government revenue. It's to keep revenue neutral, and just be smarter about what we tax."

The tax shift is modeled after a policy in British Columbia. It would cost $25 per ton of CO2, which means gas prices would go up by about 25-cents per gallon. But supporters said the sales tax reduction would save people hundreds every year, and they said it would help solve the issue of climate change.