Canada Rolls out Federal Carbon Tax in Conservative Provinces
On April 1st, 2019 the Liberal Canadian Government introduced a federal tax on carbon, finally forcing the four conservative provinces of Ontario, Manitoba, New Brunswick, and Saskatchewan into implementing the regulation. The carbon tax is meant to help reduce Canada’s reliance on fossil fuels as well as help the nation fulfill its commitment to the Paris Climate Agreement.
In 2018, the vast majority of Canadian provinces voluntarily signed the Pan Canadian Framework on Clean Growth and Climate Change, putting in place a concrete framework of taxes on all forms of carbon, including natural gas, heating oil, and of course petroleum. However, the four previously mentioned provinces all refused to sign the agreement out of fears of the effects the carbon tax would have on their economy. This week, however, the implementation of the carbon tax became mandatory, forcing these conservative provinces to begin enforcing the tax or face significant economic penalties.
The new carbon tax was met with immediate opposition from all elements of the Canadian right. Andrew Scheer, the head of the Canadian Conservative Party, tweeted on Monday that, “Trudeau is making you pay more for driving your kids to school, heating your home, and buying groceries…but he’s giving a massive exemption to the heaviest polluters. I'll scrap his unfair tax.”
Oppositionary legal action is already being taken. Brian Pallister, Premier of the Province of Manitoba, vowed to challenge the new regulation in court, claiming that it, “threatens jobs and economic growth in Manitoba.” However, it is important to note that all parties in Canada, both liberal and conservative, recognize the need for climate change recognition and that the conservative challenge to the legislation is based on how the carbon tax is implemented, not on its necessity.
The Canadian government has sought to counter the idea that the carbon tax is going to be a costly and inefficient plan that will hurt the average citizen. They have championed it as a “revenue neutral” operation, which will return most of the money made off of the tax into the hands of consumers. This is meant to occur through an annual tax rebate, which will, according to the government, will either equal or exceed the amount they were forced to pay in taxes.
The nationwide implementation of the carbon tax is a vital economic experiment, not just for Canada, but for the rest of the world. Its success or failure will help to determine whether carbon taxes are a viable method to reduce greenhouse emissions on a global scale.
However, the Prime Minister of Canada, Justin Trudeau, has maintained an optimistic stance on his plan, saying on Twitter that, “Canadians know that climate change is real and that we need to act now. Putting a price on pollution is going to protect our environment, keep our economy strong, and put more money in your pocket.” Only time will tell if this liberal leader’s plan will make a meaningful dent in global climate change.