For the past several years, local officials in cities and towns around the globe have been implementing bag taxes in a misguided attempt to diminish the usage of paper and plastic bags. Bag tax proponents within these localities claim that their efforts have not only curbed bag usage, they have also mitigated litter and generated millions of new taxpayer dollars for politicians to spend. However, other studies have shown bag taxes negatively impact the local economy and do nothing to benefit the environment or reduce litter.

The Wall Street Journal hosted an online debate on the topic over the weekend with Daniella Dimitrova Russo, Co-Founder and Executive Director of the Plastic Pollution Coalition making the case in favor of bag taxes and Todd Myers, Environmental Director at the Washington Policy Center, arguing against the taxation of plastic bags.

Myers contends bag tax and ban proponents fail to consider the unintended consequences of the bag ban, as well as implementing an incorrect cost benefit analysis to attempt to boost their argument:

“When Seattle considered its first bag ban, politicians touted the benefits, including reductions in energy and water use. The claims ignored the use of substituted bags, thus making the projections extremely favorable toward the ban. Even with those skewed numbers, my estimates show a saving of $278,452 worth of carbon emissions and water for a cost of $10 million to consumers. Somehow spending $100 to receive $3 in environmental benefit is supposed to be smart policy. Weighing the costs and benefits makes it clear that banning plastic bags yields little benefit at very high cost.”

While bag tax and ban proponents have not had success at the state level – even very liberal legislatures in California and Oregon have rejected bag tax bills in recent years – they continue to push their misguided policies at the local level. Their latest target is Boulder, CO, where voters will decide on a local 20-cent bag tax in less than four weeks.

The proposed tax in Boulder would apply to all paper and plastic bags at food retailers, including grocery stores, convenience stores and department stores such as Target. Gas stations would be exempt if food sales account for less than 2 percent of their business. Retailers would keep four cents to compensate for increased administrative costs. City officials say the remaining 16 cents would be used to pay for educating people about reusable bags, and supplying reusable bags to low-income residents who would be disproportionately affected by the fee.

A recent study commissioned by ATR found that Washington, D.C.’s bag tax has failed to generate the results and revenue the D.C. City Council had projected due to the residents finding ways to avoid paying the tax. Worse, D.C.’s bag tax has negatively impacted the local economy. According the report, “Employment losses will rise to 136 net local jobs from 101 in FY 2011, and aggregate real disposable income will fall further by $8.08 million from $5.8 million in FY 2011. Investment declines will increase to $1.58 million from $600 thousand in FY 2011.”

Even worse economic consequences can be expected if Boulder imposes a whopping 20-cent tax on every paper and plastic bag. The revenue that would be generated does not even go towards solving any real problems faced by city residents, but merely “educates” the people about why reusable bags are supposedly better. This proposed tax would add increasing volatility to the city’s business climate while negatively impacting local businesses and jobs.

ATR encourages all Boulder residents to speak out against the 20-cent tax proposal, and contact the members of the City Council and Mayor Matt Applebaum so this measure does not pass. Their respective information can be found by clicking here.