If low cost energy sources are important to economic growth. Why does government pile taxes and fees on it?

Question

Not only does the poor get soaked.(as a percentage of income) As a buisiness cost, it's also a factor that helps to slow wage growth and new employment.

Answer 1

It is a type of usage tax. Like Value Added Tax (VAT)  They stick it on those kind of things (gas, electricity, even water) to even out individual contributions.  Thus, the more you use the more you pay.  The really poor don't get such a bad deal, as what the man in the street believes.  Most of the poor, don't pay for anything except food.  Not housing, utilities, sewage etc.  They just default on their bills.  You try to get some money out of them?

Peace.

P.S. Governments are the biggest wasters of resources. Even money.

Answer 2

Taxes pay for roads.

Answer 3

But low cost energy sources also come with externalities, like pollution (climate change) and congestion (traffic).  So there is a good reason to levy taxes on these to reduce their use.  It does hurt economic growth, but so will climate change and congestion, so overall there is an improvement.  You are right, though, that it is regressive (hurts the poor disproportionately), so it is probably worth engaging in some redistribution elsewhere to compensate.

Answer 4

Good question.

My guess is that taxes on fuel are like taxes on income:  Almost invisible (most people don't pay much attention to it) and it is such an integral part of life and the functioning of society, you can't readily stop paying that tax.  I guess you'd call it leverage.

(You ought to ask the politicians this one, since I doubt you'll get a good answer from here).