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This paper explores the determinants of carbon taxation by focusing on recent efforts to tax carbon in Washington State. The paper identifies citizen demand, energy interests, and tax structure as possible factors in the emergence of carbon taxation. Washington has relatively high demand for climate action, and is unique with respect to its high reliance on indirect taxation and its low level of local fossil fuel interests. I argue this context, especially the high reliance on indirect taxation, makes taxation more appealing than other carbon pricing alternatives. I then test whether local tax structure shapes preferences for carbon taxation using county level opinion data. I find evidence that support for carbon taxation is higher in states with higher gasoline taxes, but no effect from sales and sin taxes. I conclude summarizing various accounts of each initiative’s failure, and highlight a few lessons from the efforts to tax carbon in Washington state.
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Efforts to tax carbon in Washington State
Steven M. KarceskiID*
Department of Sociology, University of Washington, Seattle, Washington, United States of America
This paper explores the determinants of carbon taxation by focusing on recent efforts to tax
carbon in Washington State. The paper identifies citizen demand, energy interests, and tax
structure as possible factors in the emergence of carbon taxation. Washington has relatively
high demand for climate action, and is unique with respect to its high reliance on indirect tax-
ation and its low level of local fossil fuel interests. I argue this context, especially the high reli-
ance on indirect taxation, makes taxation more appealing than other carbon pricing
alternatives. I then test whether local tax structure shapes preferences for carbon taxation
using county level opinion data. I find evidence that support for carbon taxation is higher in
states with higher gasoline taxes, but no effect from sales and sin taxes. I conclude summa-
rizing various accounts of each initiative’s failure, and highlight a few lessons from the efforts
to tax carbon in Washington state.
Carbon taxation continues to be an elusive policy in the United States (U.S.). Predictions of
the effects of climate change continue to increase in severity and the U.S. still lacks a national-
level carbon pricing policy, either in the form of cap and trade (emission trading systems) or
carbon taxation. These policies cannot solve the problem on their own, but they are needed as
part of a large-scale effort to reduce carbon emissions. Carbon pricing incentivizes low cost
emission reductions and across the world climate pricing policies have begun to proliferate at
the subnational level [1]. In the U.S., several states utilize emission trading systems—as in Cali-
fornia and New England’s Regional Greenhouse Gas Initiative—but there is no state in the U.
S. with a carbon tax.
In recent years, a variety of actors have worked to implement a carbon tax in the state of
Washington. While policy makers introduced bills in the state legislature, the most notable of
these efforts are the ballot initiatives of 2016 [2,3] and 2018 [4,5]. Had either of them passed,
Washington would have been the first state to explicitly tax carbon. However, the 2016 Ballot
Initiative 732 only received 40.75% of the vote, and the 2018 Ballot Initiative 1631 was defeated
with a slightly greater 43.44% (details on each policy can be found in S1 Table). This paper
investigates two questions. First, why was Washington the first state to put a carbon tax in
front of voters, and by doing so arguably become the closest state to adopt a carbon tax? Sec-
ond, since Washington State stands out in terms of tax policy, what influence does tax struc-
ture play in support for carbon taxation?
PLOS Climate | October 5, 2022 1 / 14
Citation: Karceski SM (2022) Efforts to tax carbon
in Washington State. PLOS Clim 1(10): e0000076.
Editor: Anamika Barua, Indian Institute of
Technology Guwahati, INDIA
Received: December 14, 2021
Accepted: August 25, 2022
Published: October 5, 2022
Peer Review History: PLOS recognizes the
benefits of transparency in the peer review
process; therefore, we enable the publication of
all of the content of peer review and author
responses alongside final, published articles. The
editorial history of this article is available here:
Copyright: ©2022 Steven M. Karceski. This is an
open access article distributed under the terms of
the Creative Commons Attribution License, which
permits unrestricted use, distribution, and
reproduction in any medium, provided the original
author and source are credited.
Data Availability Statement: All data used in the
analysis are available freely through various online
sources. The data are also available on the authors
GitHub repository for this project: https://github.
Funding: The authors received no specific funding
for this work.
The paper begins with a description of previous work on the determinants of carbon taxation
and other related policies. The discussion sets up a hypothesis that tax structure—particularly
the use of certain indirect taxes—shapes preferences for carbon taxation. The hypothesis is used
to guide a comparative descriptive analysis of state-level measures of citizen demand, energy
interest groups, and indirect tax policies. A second statistical analysis is then presented using
multilevel linear models to explore the relationship between support for carbon taxation and
certain indirect taxes at the state level, while controlling for citizen demand and other county
level contextual factors (demographics, industrial employment, education, and a few others).
The paper concludes by discussing various explanations for why the two Washington State ini-
tiatives failed to pass and the implications for future efforts to tax carbon in the United States.
Background and theory
Studies on the determinants of carbon taxation are quite limited. The few publications
addressing the issue, employing primarily case-based methods, suggest proportional represen-
tation and left party power are associated with national-level carbon tax adoptions [6,7]. Oth-
ers focus on how the particular design of carbon tax policy shapes support. Since tax attitudes
are shaped by taxpayer perceptions of who benefits from generated revenues [8], then the use
of revenues from a carbon tax should also shape support. Polling suggests support for carbon
tax may increase when a policy is revenue neutral [9], and experimental work finds revenue
devoted to mitigation efforts (public transit or renewable energy) increases support relative to
revenue neutrality, investment in adaptation, or compensation to affected workers [10].
In the aftermath of the Washington State ballot initiatives several post-mortem studies
emerged. At the Census tract level, car commuting, median household income, and the share
of the population over the age of 40 were negatively associated with support, and electoral sup-
port for Democratic (and Green Party) candidates and the share of people with bachelor’s
degrees (or higher) were positively associated with support [11]. A different study found ideol-
ogy—operationalized as a latent ideological index created with measures of support for other
ballot initiatives (related to policing, gun control, campaign finance, and other taxes)—was a
strong predictor of votes for the WA carbon taxes [12].
Scholars have also investigated the determinants of ‘implicit’ carbon taxes; policies not
explicitly designed to reduce GHG emissions but likely have that effect. Implicit carbon taxes
include taxes on fuel, energy, and vehicles. In general, fossil fuel production is negatively
linked to policies that would reduce production or demand (Batstrand), but more specifically
the size of the trucking industry [13] and per capita fuel consumption [14] have both been
linked to lower fuel tax rates. This body of scholarship identifies important factors linked to
citizen demand (political ideology, partisanship, and other individual level or contextual char-
acteristics) and groups with interests at stake should a carbon tax be implemented (fossil fuel
production and consumption). The role of interest groups is well-established in scholarship.
Interest group theories describe how groups compete within the political system for influence
on policy decisions in hopes to shape policy according to their specific interests [15,16]. Differ-
ent groups are affected to varying degrees and some will have more to gain or lose than others.
The size and strength of these groups, which vary across states, influence the amount of sup-
port or resistance that can be devoted to supporting or opposing a policy.
In addition to citizen demand and interest group factors, I propose tax structure should also
be considered. Building on research in fiscal sociology, I posit a state’s tax structure can influence
carbon pricing preferences of political actors and the public. One way this can happen is through
administrative capacity—the administrative or bureaucratic knowledge and infrastructure allow-
ing a policy to be effectively put into practice. It is advantageous for a government to have the
Efforts to tax carbon in Washington State
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Competing interests: The authors have declared
that no competing interests exist.
relevant administrative capacity when adopting a carbon tax policy. Building carbon taxes upon
existing excise taxes, especially those on fuel and energy, can lead to significant savings [17],
especially in compliance and monitoring [18]; when tax officials have experience dealing with
the activities being taxed, environmental taxes are often more successful [19]. Denmark, Finland,
the Netherlands, Sweden, and the United Kingdom all built their carbon taxes upon pre-existing
fuel and energy taxes [20]. Establishing administrative capacity for carbon tax adoption also
relates to the aspect of path dependent theories concerning startup costs. Once initial startup
costs are incurred it is relatively more expensive to switch to alternative institutions, sometimes
leading to a self-reinforcing process that maintains an institutional path [21,22].
Beyond initial startup costs it is unlikely administrative capacity increases proportional to
higher rates or greater revenues, but the degree to which certain types of consumption is taxed
may still be important. In order for consumption tax policies to generate high revenues or tax
activities at high rates, the policies themselves must be viewed as legitimate, normal, or the best
available option among policy actors, and also seen as a legitimate means of revenue genera-
tion among taxpayers. Scholars of historical institutionalism point out the importance of insti-
tutional context in constraining political actors and shaping views on which other policies are
feasible and which policies are preferred [23]. Indeed, tax policies have “shaped what policy
makers and interest group activists understood to be possible and desirable” [24]. "It follows
that the explanation for any particular fiscal policy itself may lie in a previous configuration of
public finances, rather than in any other contemporary circumstances" [25]. Similar claims
have been made more generally about environmental policy. Institutional context is important
when considering environmental policy adoptions since it cannot be assumed what is effective
in one institutional context is effective in others [26].
The motivation of tax policies may also be important. Most taxes are viewed as generating
revenue for specific projects (earmarking) or for contributions to a general fund. But some
taxes are designed to shape consumption behavior, and the presence of such taxes represents a
specific type of institutionalization important for carbon taxation. General sales taxes are not
implemented because consumption is viewed as bad, but taxes on alcohol, tobacco, and sugary
beverages are often supported for their effect of reducing the consumption of these goods.
This type of taxation is justified to correct failures in human rationality [27], forcing consum-
ers to pay a price that at least partially accounts for the external costs incurred to society and
costs incurred by the individual in the future. Since carbon taxes attempt to shape behavior in
a similar fashion, the normalization of taxation as a regulatory tool may shift preferences of
political actors and the public in favor of carbon taxation.
The manner in which a state taxes consumption determines the administrative capacity
and institutionalization relevant for carbon taxation. In the presence of demand for climate
action, carbon taxation might first emerge in states with the necessary administrative capacity
and relatively high levels of institutionalization of consumption and sin taxes. In this frame-
work, carbon taxation represents a continuation along the institutional path of consumption
taxation, and political actors in states with relatively high levels of it may prefer carbon taxation
over other carbon mitigation policies. I test this hypothesis with a comparative analysis of
descriptive state-level statistics and an analysis of public opinion on a revenue neutral carbon
tax aggregated at the county level.
Materials and methods
The data used in the two analyses come from a variety of sources. Public opinion data for 2016
and 2018 are from the Yale Program on Climate Change Communication (YPCCC) [28,29].
Efforts to tax carbon in Washington State
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The analyses use YPCCC surveys questions on the belief that climate change is happening, on
support for regulating CO2, and on support for a revenue neutral carbon tax on fossil fuel pro-
ducers (the first two are used in both the state-level and county level analyses, the last is only
used at the county level). Data on state-level tax rates in 2016 and 2018 are from the Tax Foun-
dation [3032]. The Tax Foundation provides tax rates for distilled liquor, beer, wine, and cig-
arettes, and created an additive index for "sin" taxation. Gas tax rates and a combined measure
of state sales tax and the average local sales tax rate are also provided. State-level energy and
electricity statistics for 2016 and 2018 are from the United States Energy Information Admin-
istration [33], including state-level measures for the share of non-CO2-emitting electricity
share, fossil fuel production (in BTUs), and non-CO2-emitting energy production (in BTUs).
Average state-level gasoline prices are estimated by the American Automobile Association
[34]. State- and county-level 2016 presidential election results come from the Harvard Data-
verse [35,36].
For the second analysis, the multilevel model, I add a series of county-level contextual mea-
sures from the United States Census [37,38]. These include median income, average number
of rooms per household, population, average travel time to work, median age, the county-level
composition of eight racial groups (White, African American, Hispanic/Latinx, Asian, Native
Hawaiian/Pacific Islander, American Indian, multiple races, and other race), education char-
acteristics (percent of population with less than high school, high school, associates, bachelors,
and advanced degrees), and the percent employment in various industries (construction, agri-
culture, manufacturing, transportation, trade, and professional/managerial).
A table with summary statistics of all variables at the state and county level is presented in
S1 Text.
The first analysis offers comparative descriptive statistics to assess whether Washington State
is unique with respect to political and environmental attitudes, the magnitude of three indirect
tax measures (sales taxes, gasoline taxes, and sin taxes), and measures related to fossil fuels
energy production, energy production of non-CO2-emitting sources, and the non-CO2-emit-
ting share of electricity production. Comparing Washington to other states reveals the relative
strength/presence of factors theoretically linked to climate policies.
The second analysis is a multilevel linear model determining the association between vari-
ous state- and county-level factors (with random intercepts included at the state level) county-
level support for a revenue neutral carbon tax on fossil fuel companies. The multilevel model-
ing approach takes into account the nested nature of the data generation process [3941], in
this case where counties are nested within states, and allows for estimation of effects from vari-
ables at the upper unit level (the state-level measures), whereas "fixed effects" models do not
allow for this.
Comparative descriptive analysis
Since a carbon tax has yet to pass in any U.S. state, very little can be said about determinants of
successful carbon tax adoption at this level. However, it is possible to employ certain theories
to help explain why Washington came the closest. Inferential statistics will suggest the determi-
nants getting close to carbon tax adoption are simply the characteristics of Washington state,
whatever they might be. Instead I use descriptive statistics to explore the comparative presence
of citizen demand, major interest groups, and indirect tax policies. State-level characteristics
are summarized in Fig 1.
Efforts to tax carbon in Washington State
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The first set of measures shows state-level support for regulating carbon emissions, the
combined Democratic and Green party vote shares from the 2016 election, and the estimated
percentage of citizens within each state reporting to believe climate change is happening and
report supporting regulating CO2 as a pollutant. Washington state scores relatively high, but
not the highest, on all three measures. Taken together, the citizen demand measures show an
association between citizen demand and actual climate pricing policies: with only one excep-
tion (one RGGI state with a below average belief that climate change is happening), all states
with carbon pricing policies fall above the mean on three measures. Even though it does not
have a carbon pricing policy, Washington State falls within the range of values with other states
that do on all measures. This is not evidence of a causal relationship between preferences and
policy; the survey data used here was collected well after RGGI and California’s cap-and-trade
were put into effect. However, of the ten states with the highest ranks across the three mea-
sures, six had cap-and-trade policies in 2016, and New Jersey, an original RGGI member that
left in 2012 (and rejoined in 2018) is also in the top 10. In short, Washington’s measures are
relatively high and on par with other states that have implemented carbon pricing policies.
The second set of measures relate to energy production and consumption. The first two
show the levels of non-CO2-emitting energy production (per capita) and the non-CO2-emit-
ting consumption (share of total electricity consumption from solar, wind, geothermal,
Fig 1. State-level measures of citizen demand, energy interests, and indirect tax policies. Fig 1 shows nine different measures (all standardized)
grouped into three categories. Symbols and colors are used to identify (a) participants in RGGI in 2016 (red squares), (b) California (blue diamonds),
(c) Washington State (green circles), and (d) all other states (black dots).
Efforts to tax carbon in Washington State
PLOS Climate | October 5, 2022 5 / 14
hydroelectric, and nuclear). Washington State has the second highest per capita non-CO2-e-
mitting energy production (after North Dakota) and the highest share of non-CO2-emitting
electricity. Further, Washington is among the group of states with zero fossil fuel production.
The energy production that would experience the largest negative consequences from a carbon
tax—fossil fuel producers—are nonexistent in Washington State, and the production of energy
that would be least affected (non-CO2-emitting) is relatively high. Further, if all states passed a
carbon tax at the same level, Washington households would, on average, would feel the conse-
quences of a carbon tax the least among all U.S. states.
The last set of measures speaks to the present study’s novel theoretical contribution; three
measures of indirect tax policies. Washington ranks among the highest in combined state and
local sales tax rates. Sales and other indirect tax policies are generally regressive (where the
share of income paid into them decreases with income) compared to direct taxes on income
Fig 2. Estimates from the multilevel linear model. The dependent variable is support for a revenue neutral carbon tax on fossil fuel companies. All
variables are standardized making the effects interpretable as changes in the percentage point support for the carbon tax that correspond to a standard
deviation increase in each variable.
Efforts to tax carbon in Washington State
PLOS Climate | October 5, 2022 6 / 14
and property [42] and Washington has one of the most regressive tax structures in the U.S.
[43]. Washington has the second highest sin tax index, and much more than any state with
other carbon price policies. The same is true of gasoline taxes; Washington has the second
highest rate and a rate significantly higher than any of the other states with carbon price
Washington state represents a unique combination of measures of citizen demand, energy
interests, and indirect tax policy. Compared to the average state in the U.S., survey data sug-
gests Washingtonians are more likely to believe in the existence of climate change and support
regulating carbon. The type of energy produced in the state—none from fossil fuels and the
majority from renewable sources—means production interest groups likely harmed by a car-
bon tax are absent, and electricity consumers in Washington State rely on the highest share of
renewable-sourced electricity in the country; if a uniform carbon tax on electricity were passed
in all states, residents in Washington would experience the smallest increase in electricity costs
in the entire country.
Washington is also distinct with respect to tax structure. Washington is known for having
one of the most regressive tax structures in the country and this is due to its high reliance on
sales, excise taxes, and the absence of a state income tax. As carbon taxes are themselves indi-
rect taxes, Washington State policy actors and taxpayers operate in a context where this type of
tax is normalized. In particular, Washington has relatively high gasoline taxes (an “implicit”
carbon tax) and sin taxes (taxes on alcohol and tobacco). In other words, Washington has
some of the highest rates for the taxes that (a) most resemble carbon taxes (fuel taxes) and (b)
are used to shape consumption behavior, which is the ultimate goal of a carbon tax.
Multilevel linear models
The second analysis tests whether the central hypothesis—that tax structure influences support
for carbon taxation—is supported with opinion data at the county level. Individual level opin-
ion would be more ideal, but non-aggregated public opinion data is not available with county-
level indicators. The statistical test presented here shows effects from measures at the county
and state level—contextual effects—and cannot speak for associations between support for the
carbon tax and individual level characteristics. The multilevel model is the best approach given
the data availability.
The model includes the "citizen demand" variables measured at the county level (support
for regulation, belief that climate change is happening, and Democratic vote share from the
2016 presidential election). In addition to measuring demand for climate action, support for
regulation allows the model to separate out support for regulation ("Regulate carbon dioxide
(the primary greenhouse gas) as a pollutant") from specific tax for carbon taxation. The model
includes three measures of indirect taxation at the state level, average state-level gasoline price,
the non-CO2-emitting share of electricity consumption at the state level, and a includes a
series of demographic and contextual characteristics at the county level, including race, ethnic-
ity, home size (in number of rooms), average age, median income, average commute time (in
minutes), education characteristics, and employment in various industries.
Fig 2 displays coefficients and 95% confidence intervals for the non-random components of
the multilevel model (full model results are presented in S2 Table). The dependent variable is
county-level support for a revenue neutral carbon tax on fossil fuel producers. An "ST" in
parenthesis marks the variables measured at the state level. All others represent county-level
measures. Variables indicating the composition of racial and ethnic groups are marked with a
prefix "R%", employment with "Emp%", and education with "Ed%". The categories for White
race and percent with a high school diploma (or equivalent) as the highest education are
Efforts to tax carbon in Washington State
PLOS Climate | October 5, 2022 7 / 14
excluded (these are the reference categories). Fig 2 sorts predictor variables according to the
effect size and direction. All predictor variables are standardized (mean-centered and in stan-
dard deviation units), making the effects comparable. Each effect can be interpreted as the per-
centage point change in support for the carbon tax that corresponds to an increase of one
standard deviation in each predictor variable.
The two predictors with the largest effects in the model are the belief that climate change is
happening (a one standard deviation increase corresponds to a 4.5 pp increase in support for
the carbon tax) and support for regulating CO2 as a pollutant (one standard deviation increase
corresponds with 1.31 pp increase). The combined Democratic and Green party vote share
from the 2016 presidential election is also significantly and positively associated with support
for the carbon tax, meaning all three of the citizen demand variables are positively associated
with support for the carbon tax.
The tax measures offer mixed support for the hypothesis. Only the state-level gas tax rate is
positively and significantly associated with support for the carbon tax. Neither the sin tax
index nor the average combined state and local sales tax rates are significantly associated with
support for the carbon tax (although the sin tax index is positively and significantly associated
in a model without the contextual demographic measures). When controlling for the state-
wide average price of gasoline—which is negatively associated with support for the carbon tax
—the model suggests an independent effect of gasoline tax rates on support for carbon taxes.
The fitted model reveals a few other significant relationships. The share of a county’s popu-
lation (over the age of 25) with less than a high school education is positively associated with
support for the carbon tax (a coefficient of 0.26), while the share of associates degree (-0.22),
advanced degree (-0.54), and bachelors degree (-0.58) holders are all negatively associated with
support. The proportion of Native Hawaiian and Pacific Islanders is positively associated with
support (0.15), while African and American (-0.17) and Hispanic and Latinx (-0.25) are both
negatively associated with support. The median number of rooms per household (0.17) is posi-
tively associated with support, and median household income is negatively associated (-0.23).
Finally, the share of employment within the transportation industry is negatively associated
(-0.16) with support for the carbon tax.
The analyses presented above sheds light on why Washington has arguably come the closest
state in the U.S. to passing a carbon tax and the role that indirect tax policies play in support
for carbon taxation. Washington State represents an ideal combination of citizen support for
climate policy, minimal energy/electricity interest groups that would be harmed by a carbon
tax, and a tax structure that taxes consumption of sales, gasoline, and alcohol and tobacco (via
"sin" taxes). Institutional theories from fiscal sociology suggest the use of these policies shapes
the way in which policy actors and citizens would view carbon tax adoption.
I find evidence suggesting citizen views toward carbon taxation are shaped in part by tax
policy. Gasoline tax rates are positively associated with support for carbon taxes; taxing gaso-
line is a component of many existing carbon taxes. However, the results do not support the
hypothesis that other forms of indirect taxation increase support for carbon taxation, at least
among the public.
While I argue the context offered in Washington State should increase support for a carbon
tax, neither the 2016 Initiative I-732 nor 2018’s I-1631 passed. Another study of the Washing-
ton ballot initiatives asked whether the carbon tax initiatives in Washington could have passed
in any other U.S. state [12]. Fitted models with demographic and political information were
used to estimate the level of support in other states, assuming the associations would hold in
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other, out of sample contexts. The authors suggest 2016’s I-732 would not pass in any state,
and only in Vermont would 2018’s I-1631 pass (although Vermont lacks the institution of
direct democracy). The authors note the large majorities supporting carbon taxation both
nationally and within many states (including Washington) does translate directly to votes for
carbon taxation. It is possible the voters in each election were not representative of the polls
(especially in the 2018 midterm with relatively lower turnout).
Other post-mortem accounts highlight additional reasons for the failure of the initiatives.
Conflict emerged among the interest groups, organizations, and activists in support of the bal-
lot initiative in 2016. In 2016, the dominant story was the opposition to I-732 from the left
[44]. The most detailed depiction of this comes from David Roberts [45]. In short, progressive
leaders expected to support a carbon tax, or any climate policy, either came out in opposition
or explicitly did not support I-732. Leaders and activists in various progressive organizations
were unhappy with I-732 because revenues were not earmarked for green investment or
spending on other issues important to their movement. Further, leadership in certain progres-
sive organizations felt the key players of I-732 were unwilling to coordinate to design a policy
to better suit their goals. Conversely, the I-732 camp felt progressives were unwilling to move
quickly enough to propose a concrete alternative. Perhaps the final blow came due to state-
ments from key I-732 figure Yoram Bauman (suggesting leftists who oppose 732 are driven by
“an unyielding desire to tie everything to bigger government, and a willingness to use race and
class as political weapons in order to pursue that desire”) [46], causing the I-732 campaign to
be perceived as having little regard for issues of social justice, clashing with the progressive/cli-
mate justice view that climate policy should include careful concern for the most disadvan-
taged. Opposition organizations included the Alliance for Jobs and Clean Energy, Fuse
Washington, Front and Centered, and OneAmerica. The Sierra Club, while they did not
oppose I-732 per se, was vocal about not supporting it. Another organization, 350 Seattle,
pulled its support for I-732 citing the lack of concern for racial and class issues [2].
Further, the revenue neutrality of I-732 was challenged, notably by the state’s own Demo-
cratic party [45]. The party called attention to a financial impact assessment calculating the
policy to be revenue negative, losing around $800 million for the state in the first six years.
This point was challenged by I-732 organizers (who maintained it was revenue neutral) and an
alternative assessment from the Sightline Institute—an organization for which Bauman for-
merly worked [47]—but the potential revenue loss was a key part of the opposition campaign.
In 2018, a number of different explanations emerged for I-1631’s defeat. This time the lib-
eral and environmental organizations supported the initiative for its revenue-positive plan.
This eliminated the possibility of revenue loss but the initiative still failed. A common explana-
tion was that, this time, fossil fuel-producing corporations were paying much more attention
and devoted significantly more resources to opposing the initiative than in 2016. This is an
indisputable fact: the “No on 1631” campaign raised $31.5 million compared to $16.4 million
raised by “Yes on 1631”. However, there is reason to question the impact of fundraising. While
the opposition campaign roughly doubled the funding for “Yes on 1631”, the opposite was
true in 2016: “Yes on 732” raised $3.2 million compared to $1.4 million from “No on 732”. In
other words, the carbon tax performed better when out-funded by the opposition: votes in
favor of carbon taxation were 40.75% in 2016 and 43.44% in 2018. One study even failed to
find an effect from opposition television ads [11]. It may be true that I-1631 would have per-
formed better had the opposition spent less, but available data make this a difficult claim to
Another factor may have been the perception of unaccountability with respect to spending.
Most of the ads from the opposition noted an undemocratically appointed committee would
hold a “blank check” to spend however they see fit. Whether true or not, it certainly seems the
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PLOS Climate | October 5, 2022 9 / 14
point was a salient argument among people who opposed I-1631. In general, I-1631 suffered
from the perception the revenues were not clearly devoted to specific spending projects. Stud-
ies in sociology demonstrate that people generally support taxation under the condition that
they can see clear, tangible benefits from generated revenues [8], but when benefits are ambig-
uous people are likely to vote in the material interests according to the information they have,
thus opposing an increase in fuel and energy costs.
Other explanations apply equally to both initiatives. One is that Washington voters are
opposed to tax increases in general. Two other races on the 2018 midterm ballot also resulted
in anti-tax victories: Advisory Vote 19 to repeal an oil spill tax, and Initiative 1634 to ban addi-
tional grocery taxes [48]. Again, citizens support taxation when they see clear benefits from the
resulting government spending, and when this is not the case they often perceive “other” com-
munities benefiting from their contributions to the state. The regressive nature of both taxes
was highlighted in opposition campaigns—despite claims from supporters for I-732, replacing
a regressive tax (the sales tax) with another regressive tax (a carbon tax) does not make it pro-
gressive (although the expansion of the Working Families benefits helps). Raising taxes, and
thus revenues, may be an uphill battle in Washington state.
There is one last explanation for why each ballot initiative was defeated in Washington: the
ballot initiative is a mechanism that makes passing both a tax and environmental policy partic-
ularly difficult. Since 1912 Washington has allowed citizens to vote directly on issues on the
November ballot. For the most part, scholars believe direct democracy leads to results that are
supported by the majority of the citizenry and in policies in their best interest [49], although
there are a number of notable exceptions [50,51].
Matsusaka identifies certain outcomes associated with states employing direct democracy:
(a) lower state and local revenue, (b) shifting taxes from the state to the local, and (c) a shift
from taxes to user fees and charges . . .requiring those who use government services pay for
them” [49]. Other scholarship suggests direct democracy, on average, results in more conser-
vative policies (death penalty and abortion restrictions) [52].
Therefore, it seems carbon taxation may be disadvantaged in the context of direct democ-
racy for reasons highlighted by each of these points, as it would increase revenues, and increase
them at the state level, and add a “tax” when shifting to service-use charges is the trend. Fur-
ther, a carbon tax is at odds with the tendency for direct democracy to favor conservative poli-
cies, as it is decidedly coded as a liberal project. These points are supported by research
suggesting that, in direct democracy, voters generally act according to their material interests
[48]. This helps explain the contradiction between strong liberal politics/support for carbon
mitigation, and the defeat of two carbon tax initiatives seen in Washington. The institution of
direct democracy may be ill equipped to pass such a policy.
This paper explores why Washington state has come the closest to passing a carbon tax with
two ballot initiatives, discusses the role of indirect taxation in support for carbon taxation, and
discusses various explanations for why they failed. Washington provides an ideal interest
group and political context that make it a prime candidate to remain a leader in the race to be
the first carbon-taxing state. It also has a tax structure that may shape the preferences of politi-
cal actors and voters in favor of carbon taxation over other alternatives. Yet despite these con-
ditions, each initiative failed. These failures will be studied in more detail as more information
becomes available and hopefully this study provides an informed launching point for such
Efforts to tax carbon in Washington State
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While it is certainly disappointing for climate activists that carbon taxation remains elusive
in Washington and other U.S. states, there is still reason to be hopeful for its implementation
in the future. I hope this paper can inform future efforts to tax carbon in the U.S. One lesson is
that political mechanisms other than direct democracy should continue to be utilized. Of
course, Washington has seen carbon taxes defeated in the legislature, but the persistence dem-
onstrated yet again with another carbon tax introduced in the senate may signal efforts to tax
carbon are here to stay. If these two elections can tell us anything, support for carbon taxation
in Washington is on the rise.
Voters need to see clear benefits from carbon tax revenues. Tying a pricing policy to con-
crete spending plans that provide tangible benefits to voters is essential, especially if spending
relates to additional mitigation. A number of conservative economists and political figures
have supported a plan that would do this, one that would provide an equal dividend to all
households [53,54]. While this plan would address the regressivity of any carbon tax, it would
not provide funding for green projects and technology. A dividend nevertheless provides a
clear benefit, and time is running out—conservative efforts to price carbon should be cele-
brated and liberals should join them. Whether benefits are in the form of jobs, dividends, or
funding education as with Inslee’s plan, these should be the central feature emphasized in all
carbon pricing policies.
Supporting information
S1 Table. S1 Table includes summary statistics for the measures used in the multilevel
regression model. The table displays the mean, standard deviation, minimum, percentiles
and 75
), median, and maximum values, as well as histograms to show the distribution.
The variables “CC is happening” and “Regulate CO2” are measured in county-level percent-
ages. The “‘16 Democratic vote %” shows the county-level Democratic presidential vote share.
The gas tax, sin tax, and average state and local sales tax indices are standardized additive mea-
sures created with state-level tax rates (each displayed in terms of standard deviations from the
mean). The racial measures each show the percentage of people from each racial group as a
share of the total population within a county. Median age is displayed in years. Median income
is displayed in thousands of dollars of annual household income. Average driving time is cal-
culated in minutes. Shares of employment in construction, transportation, agriculture, profes-
sional and management occupations, and trade are presented as a percentage employed in
those areas at the county-level. The education measures show the percentage of the population
with their highest degree corresponding to each category. Non-CO2 emitting electricity dis-
plays the state-level share of electricity generated from non-CO2 emitting sources (including
S2 Table. S2 Table displays the full model output from the multilevel regression model. All
variables were standardized for the model fit and estimated coefficients can be interpreted as
changes in the dependent variable that correspond to 1 standard deviation increases in each
independent variable.
S1 Text. S1 Text includes detailed descriptions of the 2016 I-732 and 2018 I-1631 ballot ini-
tiatives in Washington State.
Efforts to tax carbon in Washington State
PLOS Climate | October 5, 2022 11 / 14
The author would like to thank Edgar Kiser, Steven Pfaff, Sarah Quinn, and the American
Sociological Association Carbon Tax Problem Solving Group for helpful comments and sug-
gestions on this and earlier drafts.
Author Contributions
Conceptualization: Steven M. Karceski.
Data curation: Steven M. Karceski.
Investigation: Steven M. Karceski.
Visualization: Steven M. Karceski.
Writing original draft: Steven M. Karceski.
Writing review & editing: Steven M. Karceski.
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Full-text available
Public support for policy instruments is influenced by perceptions of how benefits and costs are distributed across various groups. We examine different carbon tax designs outlining different ways to distribute tax revenues. Using a national online sample of 1,606 U.S. respondents, we examine support for a $20/ton carbon tax that is: (1) Revenue Neutral: revenue is returned to citizens via tax cuts; (2) Compensation‐focused: revenue is directed to helping actors disproportionately hurt by the tax; (3) Mitigation‐focused: revenue funds projects reducing carbon emissions; and (4) Adaptation‐focused: revenue is directed to enhancing community resilience to extreme weather events. We find devoting revenue to mitigation raises overall support for carbon tax by +6.3% versus the control (54.9%) where no information on spending is provided. Other frames raise support in specific subgroups only. Revenue neutrality raises support among lower‐income households (+6.6%) and political independents (+9.4%), while ompensation increases support among lower‐income repondents (+6.1%).
Implementing environmental policies — through standards, tradable permits, or environmental taxes alike — is far from costless. For instance, when implementing an environmental tax, the tax department has to run a special unit to enforce and collect taxes and to monitor compliance. In practice, the costs of implementing environmental policies play a significant role in the choice between policy options. This chapter investigates the potential trade-off between administrative costs and incentives of environmental regulation, in particular if the government aims to reduce carbon dioxide emissions. It analyzes how the optimal choice of carbon taxes is affected by the administrative costs incurred by the regulator (government). Using a simple model, the chapter determines the optimal rates for emissions and input taxes in the presence of administrative costs and which of these taxes should optimally be introduced. It also explores and interprets the scarce empirical evidence on administrative costs of taxation in the light of optimal carbon taxation. Finally, it evaluates both explicit and implicit carbon taxation in OECD countries in terms of the trade-off and suggests some opportunities for welfare-improving carbon tax policies.
The state of Washington saw a “blue wave” in the November 2018 midterm elections. Democratic Senator Maria Cantwell was reelected with 58.4% of the vote. In the House of Representative elections, Democrats snatched the 8th Congressional district from Republicans. And yet, the carbon tax initiative (I-1631) lost, securing only 43.5% of the vote. A number of I-1631 supporters and media outlets blamed “fossil fuel” money for the defeat. The No on I-1631 campaign spent $31.6 million, while the Yes on I-631 campaign spent $16.4 million (Ballotpedia 2018). But did the I-1631 lose because the opposition spent twice as much money? In this study we test whether the variation in numbers of television ads across Washington’s four media markets influenced voting behavior. Our analysis fails to support the claim that opposition ads defeated the 2018 carbon tax initiative. We test two hypotheses with voting data aggregated at the Census tract level, tract-level demographic covariates, and TV ad counts that vary at the media market level. First, all else equal, the lower number of TVadvertisements put out by Yes on I-1631 in relation to No on I- 1631 (henceforth, the ad ratio) is associated with lower electoral support for I-1631. Our second hypothesis pertains to the change in support for I-1631 in relation to another carbon tax initiative, I-732, which was also defeated by Washington voters in 2016 with 40.8% support. While the fossil fuel industry financed the campaign against I-732 as well, it spent only $1.4 million in 2016, a fraction of the $31.6 million spent in 2018 (Ballotpedia 2016). Therefore,we hypothesize that a smaller the Yes/No ad ratio in 2018 will be associated with less support for I-1631 in relation to I-1732. We do not find statistical evidence of an association between the ad ratio and I-1631 vote share, even after controlling for Census tract-level demographic characteristics. Thus, our analysis does not support the claim that fossil fuel-funded TV advertising influenced the electoral outcome. Regarding our second hypothesis, we find that the ad ratio is negatively associated with the change in carbon tax support from 2016 to 2018. In other words, the vote share in favor of I-1631 increased with respect to I-732 in areas that received a higher number of No on I-1631 advertisements relative to Yes on I-1631 advertisements.