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Tax employers by commuting distances

Comment 6th July 2010

There are dozens of carbon taxes, and I hope my idea should replace a plethora of them! Here's a tiny story to start: It started when my I considered my friend, call him John, a nurse, is employed by an agency who sends him 70 miles to Manchester every day to the hospital job they gave him. Actually there is a hospital just  a short walk from John's house. I am quite sure there are agency nurses travelling every day from Manchester to the hospital next to John's house. How clever we are to allow this! My idea is… make businesses audit the number of commuting miles made by their employees (and agency staff), and then tax these miles. This will cut commuting miles dramatically. It should stop employers carelessly dragging in employees from all over the country, when there are potential employees on their doorstep. Businesses can easily avoid the tax, by incentivising their employees to move closer to their workplace, or having them work more from home, etc. Businesses can also move closer to their employees, and 1) pay lower than city rates 2) pay out less in wages i.e. employees need less income to support their travel to work costs! 3) do some decent tax accounting against relocation expenses (for both staff benefits and workplace removals). The green benefits are obvious.

Why does this matter?

This idea allows the government to i) collect a "makes-common-sense" tax and ii) stop inventing, maintaining and selling the acceptability of a plethora of other ones. It will reduce commuting miles, hence reduce carbon emissions. It should allow employers to reduce their wage bills, because staff who travel long distances to work require bigger wages! It may move some big employers out of congested areas. The onus is on employers to declare their tax liability, and it is a very easy one to calculate. Every business will be under pressure to do their bit.


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