Connect with us
[bsa_pro_ad_space id=12]

Business

Trudeau’s environment department admits carbon tax has only reduced emissions by 1%

Published

6 minute read

From LifeSiteNews

By Clare Marie Merkowsky

The Trudeau Liberals had first seemed to claim that the unpopular carbon tax had cut emissions by 33%, only to explain that the figure is merely a projection for 2030 and the actual reduction thus far stands at 1%.

The Liberal government has admitted that the carbon tax has only reduced greenhouse gas emissions by 1 percent following claims that the unpopular surcharge had cut emissions by 33 percent.   

During a May 21 House of Commons environment committee meeting, Environment Minister Steven Guilbeault testified that the carbon tax cut greenhouse gas emissions by 33 percent, before his department backtracked to explain that the figure is a projection for the year 2030, and that the true figure sits at a mere 1 percent.

“I will be the first one to recognize it is complex,” said Guilbeault, according to information obtained by Blacklock’s Reporter 

“If you want simple answers, I am sorry. There is no simple answer when it comes to climate change or modeling,” he said, adding, “Carbon pricing works. This has never been clearer.”  

“Carbon pricing alone accounts for around a third of emission reductions expected in Canada,” said Guilbeault, explaining this number was based on “complex statistical calculations.”  

However, Conservative Members of Parliament (MPs) pointed out that the numbers provided by Guilbeault’s department do not add up to a 33 percent decrease in emissions, as the department had characterized.  

“How many megatonnes of emissions have been directly reduced from your carbon tax since it was introduced?” Conservative MP Dan Mazier questioned.  

According to Guilbeault, after the introduction of the carbon tax, emissions reduced by five megatonnes in 2018, fourteen megatonnes in 2019, seventeen megatonnes in 2020, eighteen megatonnes in 2021, and nineteen megatonnes in 2022.  

According to Blacklock’s, Guilbeault failed to explain how the environment department calculated a 33 percent benefit.

Conservative MP Michael Kram pressed Guilbeault, saying, “I want to make sure I have the math correct.” 

“In 2022 emissions were at 708 megatonnes and the carbon tax was responsible for reducing 19 megatonnes,” he continued. “By my math that works out to a three percent reduction.” 

Associate deputy environment minister Lawrence Hanson explained that the department’s 33 percent emissions cut is a projection of the emissions cut by 2030, not a current statistic.   

“It’s the distinction between how much the carbon price might have affected emissions in one year versus how much in 2030,” said Hanson. “So when you heard us talking about its responsible for one third of reductions we were talking about the 2030 number.” 

This explanation was echoed by Derek Hermanutz, director general of the department’s economic analysis directorate, who said, “When we talk about one third, it’s one third of our expected reductions. That’s getting to 2030.” 

“Yes, but three percent of the total emissions have been reduced as a result of carbon pricing?” Kram pressed.   

“No, emissions have declined three percent in total,” assistant deputy minister John Moffet responded.  

“And so only one percent of that three percent is from the carbon tax?” Kram asked.  

“To date,” Moffet replied. 

Prime Minister Justin Trudeau’s carbon tax, framed as a way to reduce carbon emissions, has cost Canadian households hundreds of dollars annually despite rebates. 

The increased costs are only expected to rise. 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 $80 per tonne, but the Trudeau government has a goal of $170 per tonne by 2030. 

On April 1, Trudeau increased the carbon tax by 23 percent despite seven out of 10 provincial premiers and 70 percent of Canadians pleading with him to halt his plan. 

Despite appeals from politicians and Canadians alike, Trudeau remains determined to increase the carbon tax regardless of its effects on citizens’ lives. 

The Trudeau government’s current environmental goals – which are in lockstep with the United Nations’ 2030 Agenda for Sustainable Development – include phasing out coal-fired power plants, reducing fertilizer usage, and curbing natural gas use over the coming decades. 

The reduction and eventual elimination of so-called “fossil fuels” and a transition to unreliable “green” energy has also been pushed by the World Economic Forum, the globalist group behind the socialist “Great Reset” agenda in which Trudeau and some of his cabinet are involved. 

Todayville is a digital media and technology company. We profile unique stories and events in our community. Register and promote your community event for free.

Follow Author

Business

New York and Vermont Seek to Impose a Retroactive Climate Tax

Published on

From Heartland Daily News

By Joshua Loucks for the Cato Institute.

Energy producers will be subject to retroactive taxes in New York if the state assembly passes Senate Bill S2129A, known as the “Climate Change Superfund Act.” The superfund legislation seeks to impose a retroactive tax on energy companies that have emitted greenhouse gases (GHGs) and operated within the state over the last seventy years.

If passed, the new law will impose $75 billion in repayment fees for “historical polluters,” who lawmakers assert are primarily responsible for climate change damages within the state. The state will “assign liability to and require compensation from companies commensurate with their emissions” over the last “70 years or more.” The bill would establish a standard of strict liability, stating that “companies are required to pay into the fund because the use of their products caused the pollution. No finding of wrongdoing is required.”

New York is not alone in this effort. Superfunds built on retroactive taxes on GHG emissions are becoming increasingly popular. Vermont recently enacted similar legislation, S.259 (Act 122), titled the “Climate Superfund Act,” in which the state also retroactively taxes energy producers for historic emissions. Similar bills have also been introduced in Maryland and Massachusetts.

Climate superfund legislation seems to have one purpose: to raise revenue by taxing a politically unpopular industry. Under the New York law, fossil fuel‐​producing energy companies would be taxed billions of dollars retroactively for engaging in legal and necessary behavior. For example, the seventy‐​year retroactive tax would conceivably apply to any company—going back to 1954—that used fossil fuels to generate electricity or produced fuel for New York drivers.

The typical “economic efficiency” arguments for taxing an externality go out the window with the New York and Vermont approach, for at least two reasons. First, the goal of a blackboard or textbook approach to a carbon tax is to internalize the GHG externality. To apply such a tax accurately, the government would need to calculate the social cost of carbon (SCC).

Unfortunately, estimating the SCC is methodologically complex and open to wide ranges of estimates. As a result, the SCC is theoretically very useful but practically impossible to calculate with any reasonable degree of precision.

Second, the retroactive nature of these climate superfunds undermines the very incentives a textbook tax on externalities  would promote. A carbon tax’s central feature is that it is intended to reduce externalities from current and future activity by changing incentives. However, by imposing retroactive taxes, the New York and Vermont legislation will not impact emitters’ future behavior in a way that mimics a textbook carbon tax or improves economic outcomes.

Arbitrary and retroactive taxes can, however, raise prices for consumers by increasing policy uncertainty, affecting firm profitability, and reducing investment (or causing investors to flee GHG‐​emitting industries in the state altogether). Residents in both New York and Vermont already pay over 30 percent more than the US average in residential electricity prices, and this legislation will not lower these costs to consumers.

Climate superfunds are not a serious attempt to solve environmental challenges but rather a way to raise government revenue while unfairly punishing an entire industry (one whose actions the New York legislation claims “have been unconscionable, closely reflecting the strategy of denial, deflection, and delay used by the tobacco industry”).

Fossil fuel companies enabled GHG emissions, of course, but they also empowered significant growth, mobility, and prosperity. The punitive nature of the policy is laid bare by the fact that neither New York nor Vermont used a generic SCC or an evidentiary proceeding to calculate precise damages.

Finally, establishing a standard in which “no finding of wrongdoing is required” to levy fines against historical actions that were (and still are) legally permitted sets a dangerous precedent for what governments can do, not only to businesses that have produced fossil fuels but also to individuals who have consumed them.

Cato research associate Joshua Loucks contributed to this post.

Originally published by the Cato Institute. Republished with permission under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

Continue Reading

Business

Capital gains tax hike will cause widespread damage in Canadian economy

Published on

From the Fraser Institute

By Jake Fuss and Grady Munro

According to an analysis by economist Jack Mintz, 50 per cent of taxpayers who claim more than $250,000 of capital gains in a year earned less than $117,592 in normal annual income from 2011 to 2021. These include individuals with modest annual incomes who own businesses, second homes or stocks, and who may choose to sell those assets once or infrequently in their lifetimes (such as at retirement)

On Monday, two months after tabling the federal budget, Finance Minister Chrystia Freeland introduced a motion in Parliament to increase taxes on capital gains. On Tuesday, the motion passed as the NDP, Bloc Québécois and Green Party voted with the Liberals. Unfortunately for Canadians, the tax hike will likely hurt Canada’s economy. And the finance minister continues to make misleading claims to defend it.

Currently, investors who sell capital assets pay taxes on 50 per cent of the gain (based on their highest marginal tax rate). On June 25, thanks to Freeland’s motion, that share will increase to 66.7 per cent for capital gains above $250,000. (Critically, the gain includes inflationary and real increases in the value of the asset.)

According to Minister Freeland, the hike is necessary because it will bring in more than $19 billion of revenue over five years to pay for new spending on housing, national defence and other programs. This claim is disingenuous for two reasons.

First, investors do not pay capital gains taxes until they sell assets and realize gains. A higher capital gains tax rate gives them an incentive to hold onto their investments, perhaps anticipating that a future government may reduce the rate. Individuals and businesses may not sell their assets as quickly as the government anticipates so the tax hike ends up generating less revenue than expected.

Second, the government does not have a revenue problem. Annual federal revenue is increasing and has grown (nominally) more than $185 billion (or 66.2 per cent) from 2014-15 to 2023-24. Before tabling the budget in April, the government was already anticipating annual revenue to increase by more than $27 billion this year. But the government has chosen to spend every dime it takes in (and then some) instead of being disciplined.

Years of unrestrained spending and borrowing have led to a precarious fiscal situation in Ottawa. If the government wanted to pay for new programs, it could’ve reduced spending in other areas. But Minister Freeland largely chose not to do this and sought new revenue tools after realizing this year’s deficit was on track to surpass her fiscal targets. Clearly, raising taxes to generate revenue was unnecessary and could’ve been avoided with more disciplined spending.

Further misleading Canadians, the Trudeau government claims this tax hike will only increase taxes for “0.13 per cent of Canadians.” But in reality, many Canadians earning modest incomes will pay capital gains taxes.

According to an analysis by economist Jack Mintz, 50 per cent of taxpayers who claim more than $250,000 of capital gains in a year earned less than $117,592 in normal annual income from 2011 to 2021. These include individuals with modest annual incomes who own businesses, second homes or stocks, and who may choose to sell those assets once or infrequently in their lifetimes (such as at retirement). Contrary to the government’s claims, the capital gains tax hike will affect 4.74 million investors in Canadian companies (or 15.8 per cent of all tax filers).

In sum, many Canadians who you wouldn’t consider among “the wealthiest” will earn capital gains exceeding $250,000 following the sale of their assets, and be impacted by Freeland’s hike.

Finally, the capital gains tax hike will also inhibit economic growth during a time when Canadians are seeing a historic decline in living standards. Capital gains taxes discourage entrepreneurship and business investment. By raising capital gains taxes the Trudeau government is reducing the return that entrepreneurs and investors can expect from starting a business or investing in the Canadian economy. This means that potential entrepreneurs or investors are more likely to take their ideas and money elsewhere, and Canadians will continue to suffer the consequences of a stagnating economy.

If Minister Freeland and the Trudeau government want to pave a path to widespread prosperity for Canadians, they should reverse their tax hike on capital gains.

Continue Reading

Trending

X