Thursday, October 30th, 2014

'Light switch tax' isn't what Republicans claim

Republicans have said a cap-and-trade plan will cost consumers every time they flip a switch.
Republicans have said a cap-and-trade plan will cost consumers every time they flip a switch.

Taxpayers may have been shocked to learn from House Republicans that President Obama wants to pay for health care by charging them to turn on a light.

"The administration raises revenue for nationalized health care through a series of new taxes, including a light switch tax that would cost every American household $3,128 a year," the House Republican Conference said in a Web post and press release titled "Questions on the Budget for President Obama," distributed March 24. "What effect will this have on Americans struggling to pay their mortgages?" it asked.

This alleged "light switch tax" is a reference to Obama's proposal to tax power companies for carbon dioxide emissions and allow companies to trade emissions credits among themselves. That's called a cap-and-trade program, and Republicans say the companies would just pass the tax on to electricity consumers.

So any revenue raised by a cap-and-trade program amounts to a "light switch tax" on consumers, the House Republicans alleged.

We checked it out and found the Republicans were way off.

"It's just wrong," said John Reilly, an energy, environmental and agricultural economist at MIT and one of the authors of the report cited by the House Republicans. "It's wrong in so many ways it's hard to begin."

See our full item here.