Bank of Canada admits eliminating carbon tax could reduce inflation by 16%

Bank of Canada Governor Tiff Macklem testified that cutting the tax would create a one-time reduction of inflation by 0.6%, which is 16% of Canada’s total inflation rate

Bank of Canada Governor Tiff Macklem admitted that Trudeau’s carbon tax is responsible for 16% of Canada’s current inflation rate.

On October 30, Macklem told the House of Commons finance committee that eliminating the carbon tax would reduce inflation by 0.6%, which is 16% of Canada’s total inflation rate.

“That would create a one-time drop in inflation of 0.6 percentage points,” Macklem told Conservative MP Philip Lawrence, who had questioned the tax’s effect on the economy.

Currently, Canada’s inflation rate is at 3.8% which means that a decrease of 0.6% by eliminating the tax would result in a 16% decrease in the overall inflation.

Lawrence further questioned if eliminating the tax would ease the economic situation, considering it would mean a “sizable drop in inflation.” However, Macklem explained that cutting the tax would only affect inflation for one year.

“It would be helpful if monetary and fiscal policy was rowing in the same direction,” he added, explaining that government spending has made keeping interest rates steady a difficult task.

“Any standard economic textbook will tell you if you cut government spending that will tend to slow growth, raise the unemployment rate, and reduce inflation,” Macklem explained.

In September, Macklem admitted that food costs are of particular concern as “[m]eat’s up six percent, bread’s up 13 percent, coffee’s up eight percent, baby food’s up nine percent. If you look at food overall it is up nine percent.”  

To combat this inflation, the Bank of Canada has raised interest rates to 5 percent, the highest benchmark rate in 22 years. Another increase is expected in October.  

In addition to deficit spending, others have pointed to the Trudeau government’s ongoing carbon taxes and energy regulations as one of the reasons for the sharp increases in the cost of living. 

According to a March report, Trudeau’s carbon tax is costing Canadians hundreds of dollars annually as government rebates remain insufficient to compensate for the increased fuel prices. 

Last week, Prime Minster Justin Trudeau suspended his carbon tax on home heating oil, amid rising costs of living and his decreasing popularity across multiple polls.

Under the new regulations, home heating oil is exempted from the carbon tax, while rural residents will receive a 10 percent increase in the carbon tax rebate payments. The increase is set to climb to 20 percent beginning next year.

In March, the Parliamentary Budget Officer calculated the total carbon tax costs for fuel in 2023 minus government rebates. The steepest increase is for Albertans, who will pay an average of $710 extra per household. Following Alberta is Ontario with a $478 increase.  

Prince Edward Island households will pay an extra $465, Nova Scotia $431, Saskatchewan $410, Manitoba $386, and Newfoundland and Labrador $347.   

The increased costs are only expected to rise as a recent report revealed that a carbon tax of more than $350 per tonne is needed to reach Trudeau’s net-zero goals by 2050.  

Currently, Canadians living in provinces under the federal carbon pricing scheme pay $65 per tonne, but the Trudeau government has a goal of $170 per tonne by 2030.  

Related Topics:#BankOfCanada #CarbonTax #ClareMarieMerkowsky #Inflation #LifeSiteNews

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Local Business

Red Deer Downtown Business Association to Wind Down Operations

Published on December 10, 2025

Red Deer DBA

The Downtown Business Association (DBA) Board of Directors has made the decision to wind down the Association’s operations at the end of 2025.

The Board determined that the Association is no longer able to operate sustainably under the financial framework available for 2026. After exploring all reasonable alternatives, the Board concluded that it could not continue without reducing services to a level that would no longer provide meaningful value to levy-paying businesses.

The DBA does not receive any operating funding from City Hall in a regular year, all funds raised are through Business Improvement Area Levy that consists of a mandatory levy placed on all businesses operating within the Business Improvement Area. These funds are legislated under the Municipal
Government Act, to be used to promote the Business Improvement Area, which is achieved through marketing and event initiatives along with providing advocacy support primarily to local government on behalf of the business community.

In recent years, the DBA has been a committed advocate for re-examining the approach to Downtown Governance. The Board has consistently maintained that the responsibility for funding downtown initiatives in such a socially charged environment should not rest solely with the business community.

Despite their efforts, the DBA recognized that the funds generated through the Business Improvement Area Levy were insufficient to effectively address the growing challenges of the current operating environment. This ongoing financial strain highlighted the need for a more equitable and sustainable
model to re-establish the downtown as a safe and welcoming heart of the city.

At the annual DBA budget presentation to City Hall, the DBA requested the essential funding needed to implement the Greater Downtown Governance Committee’s recommendations — work that the DBA is uniquely positioned to lead and has been delivering despite depleting resources for many years. The request was not approved. Instead, The City offered a one-time $100,000 Grant-in-Lieu, paired with a proposed 60% increase to the Business Improvement Area levy in 2026.

After careful analysis, the Board concluded that increasing the levy would place undue strain on already challenged businesses and compromise the DBA’s role as a trusted advocate. Operating with the reduced funding of $225,000 would require further staff reductions in an already under resourced environment and a significant reduction in programs, making it impossible to deliver the level of support that downtown businesses deserve and vitally need.

Beginning January 1, 2026, the City of Red Deer will become the primary contact point for matters previously supported by the DBA, including downtown support programs, business-district coordination, events, safety and cleanliness support, and stakeholder engagement. The DBA will work with City staff to support a smooth transition.

The DBA will continue to provide Clean Team services through the delivery of the City-funded environmental contract until February 1st, 2026.

Quote from CEO, Amanda Gould:

“To our business community, we have always operated with your best interests in our heart, continually driving the vision of a thriving downtown environment that serves every member of our community. The changes ahead will have a significant impact on downtown, as there will no longer be an organization dedicated to ensuring the downtown remains top-of-mind, leading events, marketing initiatives, or advocating on your behalf. It is likely you will experience less coordinated support and collective representation.

After 13 years of service to you and our beautiful downtown, it is with great personal sadness that we find ourselves here, but our message remains clear – addressing the unique challenges of our downtown should not rest solely on your shoulders. We cannot, in good faith, collect a levy that does not enable us to provide the essential services needed for our evolving downtown landscape”.

Quote from DBA Board Chair, Brandon Bouchard:

“The incredible staff at the Downtown Business Association have consistently delivered on their mandate with outstanding dedication and effectiveness. Through their efforts, they have successfully promoted the downtown area, organized impactful marketing and event initiatives, and provided steadfast
advocacy support for the business community. Their work has extended well beyond the legislated requirements, as they have proactively responded to the evolving needs of downtown businesses, adapting to challenges and supporting operations within a complex and changing environment.

Despite the staff’s relentless commitment to positioning the DBA as an effective leader for downtown interests, the absence of a sustainable funding model has made it impossible to continue delivering meaningful support. The Board cannot, in good conscience, propose a levy that does not enable the
Association to meet the required level of service, address the shifting priorities of the business community, or respond to the continually evolving needs of the downtown”.

Agriculture

Growing Alberta’s fresh food future

Published on December 10, 2025

Government of Alberta

A new program funded by the Sustainable Canadian Agricultural Partnership will accelerate expansion in Alberta greenhouses and vertical farms.

Albertans want to keep their hard-earned money in the province and support producers by choosing locally grown, high-quality produce. The new three-year, $10-milllion Growing Greenhouses program aims to stimulate industry growth and provide fresh fruit and vegetables to Albertans throughout the year.

“Everything our ministry does is about ensuring Albertans have secure access to safe, high-quality food. We are continually working to build resilience and sustainability into our food production systems, increase opportunities for producers and processors, create jobs and feed Albertans. This new program will fund technologies that increase food production and improve energy efficiency.”

RJ Sigurdson, Minister of Agriculture and Irrigation

“Through this investment, we’re supporting Alberta’s growers and ensuring Canadians have access to fresh, locally-grown fruits and vegetables on grocery shelves year-round. This program strengthens local communities, drives innovation, and creates new opportunities for agricultural entrepreneurs, reinforcing Canada’s food system and economy.”

Heath MacDonald, federal Minister of Agriculture and Agri-Food

The Growing Greenhouses program supports the controlled environment agriculture sector with new construction or expansion improvements to existing greenhouses and vertical farms that produce food at a commercial scale. It also aligns with Alberta’s Buy Local initiative launched this year as consumers will be able to purchase more local produce all year-round.

The program was created in alignment with the needs identified by the greenhouse sector, with a goal to reduce seasonal import reliance entering fall, which increases fruit and vegetable prices.

“This program is a game-changer for Alberta’s greenhouse sector. By investing in expansion and innovation, we can grow more fresh produce year-round, reduce reliance on imports, and strengthen food security for Albertans. Our growers are ready to meet the demand with sustainable, locally grown vegetables and fruits, and this support ensures we can do so while creating new jobs and opportunities in communities across the province. We are very grateful to the Governments of Canada and Alberta for this investment in our sector and for working collaboratively with us.”

Michiel Verheul, president, Alberta Greenhouse Growers Association

Sustainable Canadian Agricultural Partnership (Sustainable CAP)

Sustainable CAP is a five-year, $3.5-billion investment by federal, provincial and territorial governments to strengthen competitiveness, innovation and resiliency in Canada’s agriculture, agri-food and agri-based products sector. This includes $1 billion in federal programs and activities and $2.5 billion that is cost-shared 60 per cent federally and 40 per cent provincially/territorially for programs that are designed and delivered by provinces and territories.

Quick facts

Alberta’s greenhouse sector ranks fourth in Canada:

195 greenhouses produce $145 million in produce and 60 per cent of them operate year-round.

Greenhouse food production is growing by 6.2 per cent annually.
Alberta imports $349 million in fresh produce annually.

The program supports sector growth by investing in renewable and efficient energy systems, advanced lighting systems, energy-saving construction, and automation and robotics systems.