There is a positive side to the air pollution tax for Maryland business. It sends a positive signal to the state's burgeoning environmental services and technology industry which includes leading companies in renewable energy technology and energy efficiency. Moreover, Maryland's economy can realize longer term benefits from policies which reduce the amount of money flowing out of the state for imported energy. The tax is not levied on coal production but on consumption by electric utilities and large industrial users. The tax therefore applies to all coal used to meet Maryland's energy needs regardless of origin and does not put the state's coal producers at a competitive disadvantage.
Coal producing regions already face adjustment pressures as a result of the federal Clean Air Act.
If it is shown the tax will cause further dislocation, revenues could be dedicated to programs or transferred directly to county governments to assist with economic adjustment. In this way, a tax can provide for more equitable outcomes than do conventional environmental policies. These taxes, an increase in the gasoline tax, and the air pollution tax are compared in the attached table. Unlike the air pollution tax, none of the other taxes distinguishes between clean and dirty fuels. Each would tax clean renewable energy sources at the same rate as a dirty coal plant.