Report Urges Fee on Fuels, Waste, Traffic

Levying special taxes--called green fees--on fossil fuels, household wastes and even urban traffic congestion, could reap $100 billion to $150 billion in annual tax revenues, alter the nation’s tax structure and stimulate growth, according to a report Tuesday by a Washington-based environmental think tank.

“Green fees can be used to pay for the reduction of other taxes or to pay for the reduction of the federal deficit,” said James Gustave Speth, president of the World Resources Institute, which released the report.

“In this way, we can shift some of the tax burden in America from the things we want to encourage, like working, saving and investing, onto the things we want to discourage, like pollution, inefficiency and congestion.”

The study, supervised by WRI Vice President Robert Repetto and Roger C. Dower, director of the group’s Climate, Energy and Pollution program, focused on the effect of such fees on fossil fuels, household waste and traffic congestion. Among its conclusions:

--A nationwide program of curbside recycling and a pay-by-the-bag system for household waste disposal could generate annual revenues of $6.3 billion and a net savings of $432 million after payment of recycling costs.

--A fuels tax based on carbon content could bring in $35 billion yearly and provide the United States its least expensive method of reducing carbon dioxide emissions. Strong scientific evidence suggests that increasing worldwide production of carbon dioxide may cause long-term global warming that could devastate the planet.

--Rush-hour congestion tolls could not only ease traffic jams but produce revenues of $98 billion per year.

Dower said participants in the study found as expected that green fees provide an economical way to achieve environmental protection goals. But they were surprised to learn that the fees also had enormous potential for shifting the country’s tax burden.

“At present our taxes fall mostly on just those activities that make the economy productive: work, savings, investment and risk taking,” the report said. “A better system would place more of the tax burden on activities that make the economy unproductive and that should be discouraged: Resource waste, pollution and congestion, for example.”

Dower estimated that if green fees were fully employed in the United States, they could account for 10% of the revenue raised by all levels of government.

The three areas on which the study focused represent problems of mounting environmental and economic concern.

Existing landfills are reaching capacity and environmental regulations on new ones are becoming increasingly stringent. By imposing a $1.50 per bag fee and implementing curbside recycling, the study estimated communities could reduce landfill needs by 30%.

With traffic volume far outstripping new roads and bridges, nearly $50 billion will have to be spent on highway construction by 1999 unless measures are adopted to ease congestion, the report said.

“Congestion tolls,” said the report, “could avoid these costs, while generating billions of dollars . . . for upkeep of our existing transportation infrastructure and improved public transportation options.”