Herman Daly (Ecological Economist)
‘Shift the tax base from a tax on value added (labor and capital) to a tax on “that to which value is added”, namely the entropic throughput of resources extracted from nature (depletion), and returned to nature (pollution). This internalizes external costs as well as raises revenue more equitably. It prices the scarce but previously un-priced contribution of nature.
The value added by labor and capital is something we want to encourage, so stop taxing it. Depletion and pollution are things we want to discourage, so tax them.’
From: Herman E. Daly (2009) From a Failed Growth Economy to a Steady-State Economy. USSEE lecture, School of Public Policy, University of Maryland.
‘In bumper-sticker form, “Tax bads, not goods!”. The bads are depletion and pollution (throughput), and the goods are value added by labor and capital, that is, earned income.’
From: Herman E. Daly, Joshua C. Farley (2004) Ecological economics: principles and applications. Washington,DC, Island Press.