Taxation: big, big issue. One where political and moral frontlines are laid out for battle, and tax- breaks, well that’s even bigger; an issue that’s often seen as a bastion of those looking to uphold the current elites and status quo.
Thought in terms of industry and infrastructure, a tax cut here or there sometimes seems to be the only thing oiling the wheels of fast movement in one direction or another. So is there progressive potential here too? Essentially, can tax cuts in certain areas be used for good?
Well, essentially this basic economic stimulus could be used in whatever area decision-makers want to, and of late, those working in the green technology industries may well argue their worth.
Over in the States, that giant global influencer has been issuing tax credits to the innovators of their home-made green sectors since 2009 – to the value of $2.3billion. The Government has recently announced a further $150million worth of credits to manufacturers in the clean energy as Obama’s administration grapples with getting green issues higher up the national agenda.
The arguments being made to support the new breaks are inherently mainstream ones, as Acting Secretary of the Treasury Neal S Wolin spells out:
Manufacturing the clean energy products of the future in America will create good, middle-class jobs right now and help lay the groundwork for the long-term resilience of our economy.”
Above all this proves that low-carbon issues have come a long way, from being seen as alternative and perhaps a little bit scary, to being central, solid tenets of economic stability.
In the UK, too, the potential of a tax-break to boost production and demand for green goods has not been overlooked. As part of Enhanced Capital Allowance (ECA) scheme, companies are entitled to write off of the costs of investing in energy-efficient technologies against taxable profits, and the Carbon Trust has recently won the contract to continue assessing what technologies are included in the Energy Technology List – something they’ve been doing since 2001.
A massive 38,000 products have been on the list at some point, and the Trust estimates that 10million tonnes of CO2 have been saved thanks to the scheme in the last five years alone.
Undoubtedly it would take some time for the tax break to enjoy a natural ‘re-brand’ from villain to sustainability superhero, but it’s a start.