How will the carbon tax affect the supply of plastic bags and plastic packaging? Interestingly enough, there is a school of thought that poses the question of whether such products would be eligible for tax credits under a “Carbon Tax” or “Emissions Trading Scheme.”

How so?

The recently announced Carbon Tax is designed to reduce carbon emissions into the atmosphere by pricing the emissions at $23.00 per tonne.

Plastic bags are made as a byproduct of the process of refining oil. Ethane and Propane, along with hundred of other petrochemical products are all refined from crude oil.  Every environmentalist around the world is trying to get people to stop emitting carbon into the air, and a plastic bag is essentially carbon – captured in the form of a product which will not be emitted into the atmosphere.

There are millions of barrels of oil per year that are forever locked up in a simple plastic bag. Carbon that is permanently sequestered as a plastic bag that will never be emitted is much better than the greenhouse gases which are unleashed when producing paper bags (which actually increase carbon in the atmosphere by removing trees from the environment) and also than “compostable bags” which emit another greenhouse gas – methane, into the atmosphere during degradation.

So,that being said – what is the likely result of the Carbon Tax on these products? Perhaps manufacturers could be accredited to sell carbon credits or get a rebate from the government?

Wishful thinking probably…