OT Energy subsidies

[harry]

Fossil fuel energy subsidies

[Chris Hogg]

I notice that it points out that in the UK, VAT on electricity is only

5%, and it regards that as a subsidy, which is a moot point. But of course that's for electricity from all sources, including renewables. So renewables get a double subsidy. Makes your claim in the past that 'all sources of electricity are subsidised' look a bit thin, Harry.

[newshound]

FFS it is a basic principle of UK taxation that businesses can offset their costs against their turnover when calculating tax liability. This is not a subsidy, even though the Guardian (for one) regularly claims that it is.

[Robin]

Yet again you make me think "regressive".

Try a bit of DIY: go out and count solar panels. How many do you see on blocks of flats or on the row upon row of Victorian terraces in our major towns and cities? How many do you see on detached and semi-detached houses of the kind occupied by those on higher incomes? Then consider that (leaving aside the assumptions behind those figures) there is a big difference between subsidies for sectors and subsidies for individuals. As in report from the IFS:

"Support for microgeneration, delivered through small-scale feed-in tariffs, has been rather strongly regressive, with those who benefit being richer households able to invest in the technologies in the first place. "

"Household Energy Use in Britain: A Distributional Analysis ", The Institute for Fiscal Studies, November 2013, ISBN 978-1-909463-24-0

It was rather like the government deciding to promote farmed seafood by putting a special tax on all fish (including fish fingers etc) in order to subsidise smoked salmon and lobster. But then a certain kind of politician has always been a soft touch for the "it'll make us world leaders in....".

[RJH]

Are you suggesting that the bulk of producer 'subsidy' is in fact tax relief? Can't see that in the article, and I'd not heard that before - do you have a source, where the figures are broken down?

[tim.....]

reading between the lines it does seem to be the thrust of the argument, such international organisations have form on this issue.

Of course not, that would allow readers to see just how silly their argument is

tim

[RJH]

Ah yes, of course, but the point is that that sort of shenanigans is obscure, so hardly likely to feature in a 'subsidy' calculation. I suspect newshound is referring to capital programmes - be interesting to see the figures.

:-)

[Robin]

The main argument is that users of fossil fuels do not meet the full costs, including "externalities".

To be fair to the IMF, they and other serious commentators make clear in their publications how they arrive at their figures. Eg IMF focus not on tax relief or direct subsidies (although those do exist) but on the cost of externalties such as the extra costs of health care (particulate pollution etc), traffic congestion and accidents, and climate change. You can argue with the details (eg I don't see why electric cars cannot cause i.d.c. as much congestion and as many accidents) but they don't hide how they get to them.

[John Rumm]

I note also in the article it highlights that the majority of the subsidies are in developing nations. Since these are not fully fledged and mature markets that seems inevitable, and if renewables were affordable in those markets (which they obviously won't be) they would also be subject to equal or greater subsidy.

[bert]

In article , Chris Hogg writes

Not taxing something is not a subsidy.

[harry]

These places are inhabited by the brain dead. "Poverty" is a result of being brain dead in most cases. (Or socialist)

That's not a reason to hold other people back

[harry]

Any form of financial advantage given by the government is a subsidy. Just some are more hidden than others.

[bert]

Governments don't give financial advantages they impose financial penalties to varying degrees.