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Carbon Tax

Taxpayers Federation calling on BC Government to scrap failed Carbon Tax

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From the Canadian Taxpayers Federation

By Carson Binda 

BC Government promised carbon tax would reduce CO2 by 33%. It has done nothing.

The Canadian Taxpayers Federation is calling on the British Columbia government to scrap the carbon tax as new data shows the province’s carbon emissions have continued to rise, despite the oldest carbon tax in the country.

“The carbon tax isn’t reducing carbon emissions like the politicians promised,” said Carson Binda, B.C. Director for the Canadian Taxpayers Federation. “Premier David Eby needs to axe the tax now to save British Columbians money.”

Emissions data from the provincial government shows that British Columbia’s emissions have risen since the introduction of a carbon tax.

Total emissions in 2007, the last year without a provincial carbon tax, stood at 65.5 MtCO2e, while 2022 emissions data shows an increase to 65.6 MtCO2e.

When the carbon tax was introduced, the B.C. government pledged that it would reduce greenhouse gas emissions by 33 per cent.

The Eby government plans to increase the B.C. carbon tax again on April 1, 2025. After that increase, the carbon tax will add 21 cents to the cost of a litre of natural gas, 25 cents per litre of diesel and 18 cents per cubic meter of natural gas.

“The carbon tax has cost British Columbians a lot of money, but it hasn’t helped the environment as promised,” Binda said. “Eby has a simple choice: scrap the carbon tax before April 1, or force British Columbians to pay even more to heat our homes and drive to work.”

If a family fills up the minivan once per week for a year, the carbon tax will cost them $728. The carbon tax on natural gas will add $435 to the average family’s home heating bills in the 12 months after the April 1 carbon tax hike.

Other provinces, like Saskatchewan, have unilaterally stopped collecting the carbon tax on essentials like home heating and have not faced consequences from Ottawa.

“British Columbians need real relief from the costs of the provincial carbon tax,” Binda said. “Eby needs to stop waiting for permission from the leaderless federal government and scrap the tax on British Columbians.”

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Business

Carbon tariff proposal carries risks and consequences for Canada

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A carbon tariff—a policy that would impose fees on imported goods based on their carbon emissions—is built on the idea that Canada should penalize foreign producers for not adhering to stringent climate policies. While this may sound like a strong stance on climate action, the reality is that such a policy carries major risks for Canada’s economy. As a resource-rich nation that exports carbon-intensive products like oil, natural gas, and minerals, Canada stands to lose more than it gains from this approach.

Mark Carney, who is competing for the federal Liberal leadership, has made the introduction of a carbon tariff the number two promise in his 16-point industrial competitiveness strategy.

Key problems with a carbon tariff in Canada

1. Retaliation from other countries

A carbon tariff (also known as a Carbon Border Adjustment Mechanism, or CBAM) would not go unchallenged by Canada’s trading partners. Major exporters to Canada, such as the United States and China, are unlikely to accept this policy without a response. They could retaliate by imposing tariffs on Canadian goods, making it significantly harder for Canadian businesses to compete in international markets. This could be particularly damaging for key industries like oil and gas, mining, and manufacturing, which rely heavily on exports. A trade war over carbon tariffs could weaken the Canadian economy and lead to job losses across multiple sectors.

2. Canada is an exporting nation

Canada exports far more carbon-intensive goods than it imports. By introducing a carbon tariff on foreign products, Canada is effectively inviting other countries to do the same, targeting Canadian exports with similar carbon-based tariffs. This would make Canadian goods more expensive on the global market, reducing demand for them and harming the very industries that drive Canada’s economy. The result? A weaker economy, job losses, and higher costs for businesses that depend on trade.

3. Big business paying for consumers’ emissions

The Carney plan also proposes to make large businesses bear the cost of helping individual households lower their carbon emissions. While this may sound like a fair approach, in practice, these costs will be passed down to consumers. Businesses will need to offset these additional expenses, leading to higher prices on everyday goods and services. In the end, it is Canadian families who will bear the financial burden, facing increased living costs, higher taxes, and fewer job opportunities as businesses struggle to absorb the additional costs.

CBAM in context: implications for Canada

Has this been tried elsewhere?

The European Union’s Carbon Border Adjustment Mechanism (CBAM) is currently in effect. It entered its transitional phase on October 1, 2023, during which importers of certain carbon-intensive goods are required to report the embedded emissions of their imports without incurring financial liabilities. This phase is set to last until the end of 2025. The definitive regime, where importers will need to purchase CBAM certificates corresponding to the carbon emissions of their imported goods, is scheduled to begin in 2026.

However, Europe is not Canada’s largest trading partner—that is the United States. With Donald Trump back in the presidency, there is no chance that the U.S. will implement a CBAM of its own. If Canada were to move forward with a unilateral carbon tariff, if anyone prepared to argue that it would not face significant economic punishment from the Trump White House?

Moreover, with 91 percent of the world having no carbon tariff, other countries would impose countermeasures, leaving Canadian businesses struggling to remain competitive.

This raises the question: is the push for a carbon tariff in Canada more about political positioning than economic pragmatism? Given the unlikelihood of U.S. participation, a Canadian CBAM would amount to a unilateral economic sacrifice. While this may appeal to certain voter bases, the reality is that such a policy would carry immense risks without global coordination. Policymakers should carefully consider whether pursuing this path makes sense in a world where Canada’s largest trading partner is unlikely to follow suit.

Where do others stand?

Chrystia Freeland, the former finance minister and current Liberal leadership candidate, has not explicitly detailed her stance on carbon tariffs. However, she has emphasized the importance of defending Canadian interests against U.S. economic nationalism, particularly in response to potential tariffs from the U.S.

Conservative leader Pierre Poilievre is a vocal critic of carbon pricing mechanisms, including carbon taxes, and has pledged to repeal such measures if elected.

Elizabeth May, leader of the Green Party, has consistently advocated for strong environmental policies, including carbon pricing, but has not specifically addressed carbon tariffs in recent statements.

What it means to consumers

Here are some relatable examples of carbon-intensive exports and imports for the average Canadian:

Carbon-Intensive Exports from Canada

Oil & Gas – Canada is a major exporter of crude oil, natural gas, and refined petroleum products, particularly to the U.S. If a carbon tariff were applied to these products, it could make them more expensive and less competitive in global markets, affecting jobs in Alberta, Saskatchewan, and Newfoundland.

Lumber & Pulp – Canada is a leading exporter of forestry products, including lumber, paper, and pulp, which require significant energy and emissions to produce. If tariffs are imposed on Canadian wood products, the forestry sector could suffer.

Agricultural Products – Fertilizers, beef, and grain production all have significant carbon footprints. If trading partners retaliate with tariffs, Canadian farmers may struggle to compete in global markets.

Carbon-Intensive Imports into Canada

Steel & Aluminum – Canada imports a large amount of steel, primarily from China and the U.S., which is essential for industries like construction, manufacturing, and automotive production. A carbon tariff would drive up costs for these industries.

Consumer Goods from China – Many everyday products (electronics, clothing, appliances) are imported from countries with high-carbon electricity grids. A carbon tariff could increase the price of these goods for Canadian consumers.

Food Products – Imported produce, meats, and packaged foods from countries like the U.S. and Mexico often have high transportation-related emissions. A carbon tariff could increase grocery bills.

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Mark Carney is Planning to Hide His Revised, Sneaky Carbon Tax and This Time, No Rebates

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Liberal leadership candidate Mark Carney seems to think giving you a discount code on a new furnace or some extra insulation is the best way to help you with affordability.

And he’s going to pay for the discounts by hitting businesses like fuel refineries and power plants with a hidden carbon tax. Of course, those businesses will just pass on the cost.

Bottom line: You still get hit with that hidden carbon tax when you buy gas or pay your bills.

But it gets worse.

Prime Minister Justin Trudeau at least attempted to give you some of the carbon tax money back through rebates. The Parliamentary Budget Officer consistently made it clear the rebates don’t cover all of the costs. But at least you could spend the money on the things you need most.

But under Carney’s “affordability” plan, you don’t get cash to pay down your credit card or buy groceries. You can only use the credits to buy things like e-bikes and heat pumps.

Here’s how Carney explained it.

“We will have the big polluters pay for climate incentives by developing and integrating a new consumer carbon credit market into the industrial pricing system,” Carney told a Halifax crowd. “While we still provide price certainty for households when they make climate smart choices.”

Translation: Carney would still make Canadians pay, but he’ll only help them with affordability if they’re making “smart” choices.

Sound familiar? This is a lot like the scheme former opposition leader Erin O’Toole ran on. And it ended his political career.

Carney’s carbon tax plan is terrible for two reasons.

First: it’s sneaky. Carney wants to hide the cost of the carbon tax. A powerplant running on natural gas is not going to eat the cost of Carney’s carbon tax; it will pass that expense down to ordinary people who paying the bills.

Second: as anemic as the Trudeau government rebates are, at least Canadians could use the money for the things they need most. It’s cash they can put it towards the next heating bill, or buy a pair of winter boots, or pay for birthday party decorations.

That kind of messy freedom makes some central planning politicians twitchy.

Here’s the thing: half of Canadians are broke and a discount on a new Tesla probably won’t solve their problems.

About 50 per cent are within $200 each month of not being able to make the minimum payments on their bills.

With the cost of groceries up $800 this year for a family of four, people are watching flyers for peanut butter. Food banks have record demand.

Yet, Carney wants Canadians to keep paying the carbon tax while blindfolded and then send thank-you cards when they get a few bucks off on a solar panel they can’t afford.

Clearly the architects of Carney’s plan haven’t spent many sleepless nights worrying about paying rent.

One of Carney’s recent gigs was governor of the Bank of England where he was paid $862,000 per year plus a $449,000 housing allowance.

With ermine earmuffs that thick, it’s hard to hear people’s worries.

About a thousand Canadians recently posted home heating bills online.

Kelly’s family in Northern Ontario paid $134 in the carbon tax for December’s home heating. Lilly’s household bill near Winnipeg was $140 in the carbon tax.

The average Alberta household will pay about $440 extra in the carbon tax on home heating this year.

After the carbon tax is hiked April 1, it will add an extra 21 cents to a litre of gasoline and 25 cents per litre of diesel. Filling a minivan will cost about $15 extra, filling a pickup truck will cost about $25 extra, and a trucker filling a big rig will have to pay about $250 extra in the carbon tax.

Trudeau’s carbon tax data is posted online.

Carney’s carbon tax would be hidden.

Carney isn’t saying the carbon tax is an unfair punishment for Canadians who are trying to drive to work and heat their homes.

He says the problem is “perception.”

“It has become very divisive for Canadians,” Carney told his Halifax crowd about the carbon tax. “It’s the perceptions of the negative impacts of the carbon tax on households, without fully recognizing the positive impacts of the rebate.”

Carney isn’t trying to fix the problem. He’s trying to hide it. And he wants Canadians to be happy with discount codes on “smart” purchases instead of cash.

Kris Sims is the Alberta Director for the Canadian Taxpayers Federation.

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