The rebate can be paid out more frequently than annually.

Having a carbon tax seems to be the most fair way to combat climate change; unfortunately in practice it is political suicide. Australia had a carbon tax in 2011 and was quickly repealed in 2014. Likewise Canada also implemented such a tax in 2019 and was repealed this year prior to their election. People like to say that they want to help the environment, but when it comes time to vote they vote against such policies.

The Australian implementation had a lot of problems. Instead of being a tax applied to say, coal, oil & gas it was a scheme that applied to the 500 largest emitters. These emitters then (crucially) estimated their own emissions minus offsets and paid tax on that.

The issue with this is that it creates a whole parallel (and largely fake) carbon accounting world. Fake estimates, fake offsets - but real public money.

Yes, carbon taxes are tricky, with loopholes and grifters etc.

But it's still substantially simpler, with fewer loopholes and grifters than any of the effective alternatives proposed.

Canada ultimately repealed the carbon tax because it was used as a political cudgel against the Liberal party that enacted it by the Conservative opposition in a sustained fashion for several years.

Which is dismaying because carbon taxes are a conservative solution to this problem and IIRC the first political entities to suggest the implementation of them in Canada were Conservative.

At the end of the day you have a nontrivial amount of the population, and many in positions of power who just outright deny environmental concerns and climate change as an existential threat.

They aren't going to approach this problem in good faith and it isn't obvious what the solution to their nefarious influence on policy should be.

Canada's implementation had two problems:

1. The textbook implementation involves 3 parts: tax, rebate and tariff. Canada only did the first 2. They were in talks with Germany/EU to create a carbon tariff zone, but that never happens. Without the tariff the carbon tax is massively unfair to local producers.

2. The rebates were almost invisible. If they would have been cheques in the mail it would have had much more impact psychologically.

But I agree, the main problem was denialism and its use as a political cudgel. It should be hard to argue that carbon tax is stealing money when all of it is given back, but they successfully did that.

Broadly agreed. IMO the Canadian carbon tax had a marketing problem. It should have been called a Carbon Dividend. First, it would have replaced the negative connotation of the word "tax" with the positive connotation of the word "dividend -- and it would have been more accurate to how the program actually worked.

Second, and probably more important: the rebates showed up in your bank account with a description that didn't make the source obvious enough for laypeople. Had people seen monthly "CARBON DIVIDEND" credits in their bank accounts, they would have noticed.

In official communications it was called the Canada Carbon Rebate or previously the Climate Action Incentive

Both of which were terrible marketing wise.

What makes "rebate" terrible but "dividend" good? They accomplish the same thing in my mind. In fact I think calling it a "dividend" would be a pretty unconventional and contrived usage of that word.

Rebate: focuses attention on the tax. Dividend: focuses attention on the income people receive.

Never heard of the Alaska Permanent Fund Dividend? Except that one enshrines CO2 emissions instead of curbing them.

It was never called carbon tax, but carbon pricing. It being knows as carbon tax was the result of of opposition efforts. The same efforts and results would have happened had it been called dividend or anything else.

The feds had it labeled, "Canada Carbon Rebate", and to even get that they had to fight the banks.

https://www.cbc.ca/news/politics/carbon-pricing-rebates-land...

You can give the rebate based on prior year or estimated usage at the start of the year, and then repay at the end of the year if it was too much, like with healthcare subsidies.

The rebate is a fixed amount, no need for estimation.

The same thing happened with electric car purchase incentives in New Zealand. The poor cannot afford to buy a new car - so only the well off received the efficient car discount incentives.

The trickle down as those cars depreciated in value was years away.

That doesn’t really sound like the worst thing?

Someone has to buy them for full price before they show up on the used market 5-10 years later.

That doesn't make sense because the second hand car is not cheaper by the amount of the subsidy. Say subsidy is $20k, second-hand car might eventually be $6k cheaper (and the discount time value of money means that the $6k is actually less than $4k). Giving the wealthy person $20k, and the poor person less than $4k is strange.

New Zealand used car market is likely very different from the market where you are. The cheapest Model 3 I could find was a USD18000 for a 2020.

Subsidies make sense if the environmental gains outweigh the costs of the subsidies.

Subsidies: there was a purchase subsidy, charging stations were subsidised, and I think electric cars are not paying their fair share of road maintenance (much of our road costs are paid for by an excise tax on usage via petrol-tax or heavy-vehicle-milage).

That math doesn’t add up. If I buy a $100,000 car for $80,000, and I sell it to someone for $60,000, the recipient still gets a $40,000 discount.

And if you pretend that there is no subsidy, and the original owner paid $80,000 just because it cost that much unsubsidized, the second buyer still gets the same discount off the original purchase price.

So the fact that the car was originally subsidized isn’t relevant.

The context is about when cars reach the poor - your example of someone spending $60k is irrelevant.

A poorer person in NZ spends at most a few thousand on their car. The original retail price is nearly irrelevant by the time it gets to someone poorish (however maintenance/parts costs do matter for old cars).

The financial benefit of a discount mostly goes to the people that own the car while it depreciates as it trickles down.

Context: In New Zealand, the vast majority of people drive second hand cars (mostly imported second hand from Japan). A 20 year old car is regarded as newish in New Zealand. I am well off, so I have two second hand cars, my daily driver is 2006 I think, and I have a 1996 4WD for other stuff. New cars are only bought by the well off.

I hear you. The numbers I provided were manufactured to illustrate the math and support my argument, not to be representative of a typical price.

I thought about it some more but it is hard to explain.

I wonder if your mental model is that a $20k discount applies at all future prices - so that when the car is sold for $5k that it's "actual" worth is $25k.

My mental model is that when the car is sold at $5k it is worth $5k and the $20k discount has disappeared (the value captured by the early owners).

Background: I'm a top 5% earner but I have friends who are struggling financially.

My opinion is that the discounts is money paid for by our taxpayers into overseas pockets, that benefits a few well off people. Strangely enough the discounts were introduced by our more socialist party, and removed by the incoming less socialist party. I don't believe the discounts are an equitable use of government funds.

I am also extremely sceptical that there is enough environmental benefits: the policy appears green but perhaps it is not (greenwashed).

My original point is that any subsidy increases the number of cars that are sold, which downstream increases the number available on the used market.

Basic supply and demand. Increases supply keeps prices down

Road damage increases by the fourth power of axle weight. So up to a rounding error all road damage is caused by trucks.