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CO2 International Tariffs: Just Say NO

By Robert Bradley Jr. -- January 16, 2024

“The PROVE IT Act and carbon tariffs are not just bad policy, but bad politics. After all, supporting new taxes and opposing affordable and reliable energy is a toxic concoction.”

The letter of January 16, 2024, to members of Congress, with 42 signatories (listed at the end) follows:

As the Senate Environment and Public Works Committee is reportedly going to mark-up the PROVE IT Act (S. 1863) this week, the undersigned organizations want to express strong opposition to carbon tariffs
and the PROVE IT Act. This legislation is a gateway for a carbon tax on imported goods and a domestic carbon tax.

It is shocking that legislators would contemplate advancing policy that would increase taxes, drive up prices for American families, harm workers and those on fixed incomes, and punish energy use.

Yet this is precisely what a carbon tariff does. A carbon tariff is two taxes in one. First, a carbon tariff is a tax on imported goods, borne by American consumers, workers, and businesses. Once the structure for imposing a carbon tariff has been established, it can then be used to impose a domestic carbon tax.

To think that the government would develop the administrative infrastructure to impose a domestic carbon tax without following through is naïve, at best. If the United States were to impose a tax on imports based on their carbon intensity, then there would be an expectation that domestic goods would be subjected to a comparable tax-based scheme. In fact, a domestic carbon tax might be required to meet international trade obligations.

The PROVE IT Act is not a benign government measurement scheme that will exist for knowledge purposes. It would create a detailed carbon-emissions measuring system for domestic and foreign goods, putting into place exactly what is needed to implement a carbon tariff and a domestic carbon tax.

Some proponents assert that the PROVE IT Act will help respond to the European Union’s (EU) carbon tax, otherwise identified as a carbon border adjustment mechanism. The United States should push back against the EU’s extreme green policies and not, under any circumstances, accept their disastrous environmental and energy policies.

The EU’s carbon border adjustment mechanism and carbon tariffs are a way to impose extraterritorial regulations. Recently, we have seen these types of regulations domestically, as American farmers know all too well. Some states have imposed barriers to selling goods, such as eggs and pork, based not on the nature of the goods but due to moral and ethical preferences on how food should be produced.

Just imagine foreign countries trying to impose their moral preferences on Americans by using tariffs as leverage over how the U.S. uses energy or how American farmers produce food. Carbon tariffs and the PROVE IT Act will help establish this precedent.

Maybe even worse than the imposition of all these new taxes is the purpose of the taxes. They are taxes to punish energy use. Since more than 80 percent of the world’s energy comes from coal, natural gas, and
oil, which produce carbon dioxide emissions, a carbon tariff is a tax on the energy that makes modern life possible.

It would make medical care, housing, communications, food, and transportation less affordable, especially for people who already struggle to pay their bills. It would have a disproportionate impact on the poor and hurt those on fixed incomes, the elderly, and local institutions like hospitals, libraries, and schools.

The PROVE IT Act and carbon tariffs are not just bad policy, but bad politics. After all, supporting new taxes and opposing affordable and reliable energy is a toxic concoction.

A new survey sponsored by the American Energy Alliance and the Committee to Unleash Prosperity found that most Americans opposed a carbon tariff on imported goods, with 63 percent of Republicans opposed.

This opposition to paying carbon or energy taxes becomes even clearer when respondents were asked
what they are willing to pay each year to address climate change. The median response was just $10, and
35 percent (including 17 percent of Democrats) said they are unwilling to pay anything. American Energy
Alliance president Thomas Pyle captured the results very well:

The results reconfirm what we already knew: voters are not willing to pay any tax associated with
carbon dioxide or energy – including a carbon dioxide or energy tax on imported goods. Those
who believe in limited government and free energy markets continue to be allied with the vast
majority of voters concerning the destructive and pointless nature of carbon dioxide taxes and on
the fundamentals of the climate change issue.

As the markup of the PROVE IT Act approaches, there may be disingenuous gimmicks such as amending
the bill to say it may not be used to impose a carbon tariff. Such a provision does not change the fact that
the foundation would have been created to impose a carbon tariff and domestic carbon tax. Any new
legislation could easily get rid of such a prohibition, and that is exactly what would happen.

The PROVE IT Act and other carbon tariffs efforts show a complete disregard for what matters to
Americans. They want affordable, reliable energy to power their homes and lives, not government
meddling that drives up their household bills. They don’t want federal schemes that treat energy use as a

We strongly urge legislators to oppose the PROVE IT Act and any other legislation dealing with carbon

Daren Bakst: Director, Center for Energy and Environment, Competitive Enterprise Institute
John Droz, Jr.: Founder, Alliance for Wise Energy Decisions (AWED)
Phil Kerpen: President, American Commitment
Kristen Walker: Policy Analyst, The American Consumer Institute
Thomas J. Pyle: President, American Energy Alliance
Jason Isaac: CEO, American Energy Institute
Margaret Byfield: Executive Director, American Stewards of Liberty
Richard Manning: President, Americans for Limited Government
Brent Gardner: Chief Government Affairs Officer, Americans for Prosperity
Grover Norquist: President, Americans for Tax Reform
David T. Stevenson: Director, Center for Energy & Environment, Caesar Rodney Institute
Ryan Ellis: President, Center for a Free Economy
Daniel Mitchell: President, Center for Freedom and Prosperity
Jeffrey Mazzella: President, Center for Individual Freedom
Isaac Orr: Policy Fellow, Center of the American Experiment
Craig Rucker: President, Committee for a Constructive Tomorrow (CFACT)
Elizabeth Stelle: Director of Policy Analysis, Commonwealth Foundation
Matthew Kandrach: President, Consumer Action for a Strong Economy
E. Calvin Beisner: President, Cornwall Alliance for the Stewardship of Creation
Dr. Steven J. Allen: Vice Chairman, The Conservative Caucus
Jerry R. Simmons: President/CEO, Domestic Energy Producers Alliance
Kristen A. Ullman: President, Eagle Forum
Craig Richardson: President, Energy & Environment Legal Institute (E&E Legal)
Adam Brandon: President, FreedomWorks
George Landrith: President, Frontiers of Freedom
Cameron Sholty: Executive Director, Heartland Impact
James Taylor: President, The Heartland Institute
Ryan Walker: Executive Vice President, Heritage Action for America
Mario H. Lopez: President, Hispanic Leadership Fund
Tom Harris: Executive Director, International Climate Science Coalition
Annette Olson: Chief Executive Officer, The John K. MacIver Institute for Public Policy
Jon Sanders: Director, Center for Food, Power, and Life, John Locke Foundation
Seton Motley: President, Less Government
Bob Barr: Chairman, Liberty Guard, Member of Congress, 1995-2003
Brandon Arnold: Executive Vice President, National Taxpayers Union
Daniel C. Turner: Founder & Executive Director, Power The Future
Donna Jackson: Director of Membership Development, Project 21 Black Leadership Network
Paul Gessing: President, Rio Grande Foundation
Bette Grande: CEO and President, Roughrider Policy Center
The Viscount Monckton of Brenchley: Deputy Director (Intelligence), Strategic Threat Assessment Group
David Williams: President, Taxpayers Protection Alliance
Derrick Max: President, Thomas Jefferson Institute for Public Policy
Ben Zycher: Senior Fellow, American Enterprise Institute*

  • For affiliation purposes only

One Comment for “CO2 International Tariffs: Just Say NO”

  1. Ron Clutz  

    A Daily Signal article adds reasons to oppose PROVE IT:


    “But a carbon tax has four major disadvantages—it is inflationary and regressive, it causes regional disparities, it is complex, and it drives production offshore. America is stronger without it.”

    “Inflationary and Regressive. One major problem with the carbon tax is that it would raise prices, because all products contain carbon. Inflation is running at almost 4% and has reduced Americans’ real incomes. Since low-income people spend more on energy as a percent of their income than high-income people, a switch to a carbon tax would have to be accompanied by income transfers to low-income groups—i.e., some type of subsidy paid for by taxpayers.

    Proponents suggest that offsets, paid for by carbon tax revenues, can be returned to taxpayers through lower income taxes, perhaps with the proceeds going chiefly to poor people who are disproportionately hurt by what is in essence an energy consumption tax.

    However, Congress rarely cuts one tax by as much as it raises another tax, so Americans will end up paying more in taxes. Further, many poor people are not required to file tax returns, and they would have to do so in order to be identified and compensated. That means extra work for them and for the Internal Revenue Service.

    Regional Disparities. Another problem is that carbon-intensive sectors, such as coal, heavy manufacturing, and agriculture, would be the biggest losers under the new tax. This means higher prices for food and gasoline for everyone, especially in rural areas, as well as companies announcing that they are moving offshore. Farmers in Germany, France, the Netherlands, and Belgium are rioting against the new climate provisions.

    Complexity. A carbon tax is complex to set up, as can be seen from the PROVE IT Act. The bill selects which products are analyzed and then open to be taxed. Practically all products have some carbon in the content or in the manufacturing process or both, even food and clothing. That is why European carbon taxes range from 2% to 81% of carbon emissions.

    Proponents of the tax suggest putting tariffs on imports in proportion to their carbon content so that American companies will not be at a disadvantage. But the precise quantities are complex to calculate, and tariffs might be illegal under World Trade Organization regulations.

    Greater Offshore Production Increases Global Emissions. Carbon taxes raise the prices of domestic energy-intensive goods compared to imports from countries without carbon taxes. If American goods were taxed, Americans would prefer to buy cheaper, untaxed imports, and American firms would relocate abroad to avoid the tax or lose business to foreign companies.

    This potential relocation reduces the goal of the tax, namely to lower global emissions and global temperatures. It also potentially sends millions of jobs overseas.

    With production going abroad to countries with less stringent environmental regulations, global emissions might well rise rather than decline. Without a carbon tax, U.S. carbon emissions declined by 1,000 million metric tons over the past 16 years due to the substitution of natural gas for coal. Other countries do not have America’s inexpensive natural gas and rely more on coal. Therefore, companies relocating overseas would rely on dirtier, coal-produced energy.

    A carbon tax would hurt the poor and raise domestic prices relative to the prices of many imports. It would be another add-on levy, with exemptions for political friends and punishments for enemies. The PROVE IT Act is a first step toward the tax, and Congress would be wise to reject the bill.”


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