There's been a bit of talk recently about the ability of municipalities to tax. The provincial Minister's Council on Municipal Sustainability put forth a recommendation that municipalities ought to be able to collect taxes on amusements, tourism, property transfers and vehicle registration.
 
Although this would allow some much needed flexibility at the municipal level, I can only agree with the vehicle registration taxation.
 
Any sane taxation scheme should tax bad things and subsidize good things. Sometimes we do tax bad things (ie, the tax on cigarettes). But sometimes we tax good things that shouldn't be taxed (ie, the payroll tax for companies who provide employment to people).
 

 
Pollution and urban congestion is a bad thing, so it can probably stand to get taxed a bit more. Thus, a tax on vehicle registrations at the local level is warranted.
 
However, the proceeds from that tax shouldn't just be put into general revenue. It should -- as much as possible -- be channelled into activities that should be subsidized (ie, good things, as mentioned above). And it should be done on a revenue neutral basis.
 
What's a good thing related to pollution and urban congestion? Public transit and bike paths come to mind.
 
Just remember, though. Taxation is a form of power, and as Lord Acton said "Power tends to corrupt...". And as I imply on my other website, taxation should ideally only be used to provide "public goods".