Policy: Price Linking

All taxes should be kept within their own sphere.

For example:

• petrol taxes should be used to clean up or prevent damage to the environment (ie air pollution or the development of solar technologies). It might also be used for roads, but should not be used for welfare as this is totally external to it's sphere.
• poker machine taxes, if they must be charged, should be used solely for rehabilitation of gambling addicts
• taxes on cigarettes, if they must be charged, would be used to fund lung cancer research or treatments.
• Red Light Camera fines would be kept for victims of car crashes, or for education in safe driving

The goal of the price linking is to create more closely a user-pays system. This stops governments from profiteering with hidden tax regimes. You can only put so much into Gambling Rehabilitation before extra money will not make extra difference, thus taking away the government's incentive to approve or disapprove extra poker machines - as they are not gaining revenue from it.

The two beauties to price linking are:

1. Flexibility - a 5 % increase in driving with a particular fuel would create 5% extra revenue for roads, or cleaner fuel research etc. It self regulates.
2. Accountability - because funds are drawn from with in it's own sphere, it creates internal accountability. This prevents a "false economy". (ie cheap fuel that causes damage to the environment does not reflect it's true cost compared to another fuel slightly more expensive which is clean)

In brief, price linking means effectively that smokers pay for the possible consequences of smoking, dangerous drivers pay for the damage they cause, and so forth.

Related: Key 06-C+R, Key 16-JUS