Friday, March 20, 2009

Taxing Plastic Bags, From Pennies Here to Millions There

Taxing Plastic Bags, From Pennies Here to Millions There
from The New York Times City Room Blog
February 2nd 2009


Mayor Michael R. Bloomberg proposed a 5-cent fee on new plastic bags at the store register last week. While that figure was a penny lower than the 6 cents per bag proposed in November, another figure tucked on Page 34 of the 59-slide presentation was a real eye-opener. The projected revenue for this “user fee” was $84 million — a sharp increase from the last figure floated, just $16 million. Other estimates suggested the revenue would rise to $144 million by 2011 and $124 million in 2012.

How did these numbers get so high?

Two things are happening, according to the mayor’s office. First, the scope of the proposed tax — which would require approval from the State Legislature in Albany — has been expanded beyond grocery stores. It would include bags given out by department stores, restaurants and other retailers.

“It’s not just your local bodega,” said Jason Post, a spokesman for the mayor. “It’s going to be your candy shop, your Macy’s.”

In addition, he said, the revenue estimate increased because the Department of Sanitation “went back and looked at the waste stream more closely and found that there are far more plastic bags used in the city than we first thought.”

Still, the estimates were surprisingly aggressive. A $144 million estimate, at 5 cents a bag, means that 2.88 billion plastic bags would be used by New Yorkers each year, even with the fee. Past estimates put that figure at one billion new plastic bags.

That breaks down to one bag for every man, woman and child in New York City every single day of the year. The site estimates that 500 billion to 1 trillion plastic bags are consumed annually around the globe. Do New Yorkers alone really consume more than 1 out every 300 plastic bags in the world?

Though originally called a “fee” (which would only require City Council approval), the city’s top budget official said it would be considered a tax (which, like the $900 million increase in the city’s sales tax, would require approval from Albany).

The plan seems very likely to invite debate and discourse, as foot-bound New Yorkers seem unhappy at the prospect of carrying their own bags around to avoid the charges. But if the proposal passes, New York City would be following the lead of many European municipalities, and it would become one of the first places in the United States to assess a plastic bag tax. (Since 2007, San Francisco has simply banned plastic bags at the grocery store.)

Some have noted that environmental equation on reusable versus disposable bags is not so clear-cut. The more durable bags require an order of magnitude of more energy to produce. The anti-plastic campaign has drawn a sharp defense from the American Chemistry Council (every product has a constituency). The council argues that a drop in disposable plastic bags means an uptick in the purchase and use of other bags, like garbage bags, since plastic is still needed for trash and pet waste. The council has enumerated what it calls plastic bag myths.

In theory, disposable plastic bags can be recycled. But few are, despite a City Council bill that required large stores and chains to do so. Advocacy groups argue that each high-quality reusable shopping bag has the potential to eliminate hundreds, if not thousands, of plastic bags over its lifetime.

“Part of the purpose of the fee is to deter people from using the bags,” Mr. Post said. “We’ve baked into this, that the plastic bag consumption is going to fall.”

That is why the revenue estimate dips $144 million to $124 million in 2012. But will bag consumption drop just 14 percent from year to year?

After all, just a few weeks after Ireland adopted a 33-cent charge on plastic bags in 2002, plastic bag use decreased by 94 percent. Plastic bag use is not simply an issue of finances, but also public shame. Of course, 33 cents per bag is a bigger disincentive.

Mr. Post said the mayor’s office is comfortable with its figures.

“That is our projection,” he said. “Could it be wrong? It certainly could.”

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