Thus, the U.S. taxation system favors people spend every cent they make on whatever they can find, regardless of environmental impact.

Consumption patterns would change dramatically if work was not taxed at all, but rather, we were taxed on how much stuff we buy, and whether that stuff is sustainable or not.  This concept is known as a national sales tax.

Supporters say that a national sales tax of around 23% could completely replace the income tax, payroll tax, inheritance tax, capital gains tax and self-employment tax in the United States. The bill which introduced this concept to Congress is known as the Fair Tax Act. 

Hard-working people who save more and buy only what they really need will wind up keeping much more of what is theirs.  This would lead them to purchase more high-quality, durable goods.

A secondary goal of taxation is to encourage sustainable practices.  Energy policy is a perfect example of opportunities for beneficial taxation.  For instance, a big, polluting sport-utility vehicle should be taxed at a higher rate than an equally valuable sedan which uses far less fuel and has lower emissions.

For instance, petroleum taxes in the United States are the lowest in the first  world, averaging about 19% of the price in 2005.  However, since a large amount of that money goes back into road building, a huge part of that is a subsidy to the oil and gas industry.  Smarter energy taxes would put that money into building alternatives to fossil-fuel powered vehicles.

Smarter tax policies can profoundly change housing, too.  For instance, a 4,000-square foot house located on prime farmland and made from virgin timber should be taxed at a higher rate than a co-housing unit made from recycled products and built in a brownfields site.

Also, disposable products should be taxed at a much higher rate than a comparable, but high-quality and durable, item. 

Food taxes should encourage healthy diets; for instance: 

• Exempt water, fruits, vegetables, nuts and grains entirely. 
• Discount taxes on organically produced food.
• Tax meat and dairy lightly.
• Tax junk foods like soda, cookies, fast-food and frozen dinners--and luxury foods like pate' and caviar--highest. Perhaps base the tax on fat or sugar content.
• Tax hydrogenated fat and use the money to research its affect on cardiovascular disease.
• Tax high-fructose corn syrup and use the money to fight diabetes.