Washington’s Carbon Tax Swap and Sweden’s Success
Sweden implemented a carbon tax in 1991 and it has many similarities with I-732.
- Started at a relatively modest level, increased over time and is currently the highest in the world at around $130 (117 euro).
- In turn reduced other taxes and increased tax deductions for low and middle income households. Turns out not even Swedes love paying more taxes and prefer a tax swap.
- Was part of a broader set of energy and carbon policies. Much as I-732 is not the only policy needed to reduce carbon emissions.
Sweden’s experience has been generally very positive and is captured in this presentation that was shared with a delegation from Seattle in 2013. In summary, Sweden has seen reduced CO2 emissions while enjoying strong BNP growth (-20% and 59% respectively from 1990 to 2012).