Schwarzenegger U-turns in favour of California container tax

CALIFORNIA Governor Arnold Schwarzenegger now backs the new container tax after his earlier opposition because he feared it would damage the economy, according to the Los Angeles Daily News.

Within days of southern California ports approving a GBP18 (US$35) per TEU tax Governor Schwarzenegger announced his support for it. Welcoming America's top tax collector, US Treasury Secretary Henry Paulson, at Long Beach, Governor Schwarzenegger said he now saw the tax as an option to put back money into environmental programmes: "I think fees are good; we just have to work it out with the various stakeholders."

The turnaround reflects the state's pressing concern over pollution at a time when Long Beach and Los Angeles handle almost half the nation's international trade and are the largest fixed source of air pollution according to air quality regulators.

The Republican governor has been working with Long Beach's Democratic Senator Alan Lowenthal to increase support for a GBP15 (US$30) tax on each container in the state of California, alongside developing a programme where private industry may fund transport infrastructure repairs. Rail improvements and a programme to reduce health problems associated with diesel pollution are some of the issues to be fixed from the estimated GBP252 million (US$500 million) from fees annually.