“After two years of saying that a carbon tax would not affect Canada’s competitiveness and hurt our economy, the federal government just admitted that it actually will … A watered down poison is still a poison and this is economic poison.”
– Saskatchewan Premier Scott Moe
The carbon tax issue has largely quieted down in Alberta lately, but it is certainly heating up at the federal level. The Alberta plan was most definitely a wealth transfer whereby low-income taxpayers received a rebate supposedly to approximate what the carbon tax was actually costing them.
The federal plan however proposes to rebate 90 per cent of the revenue collected to every taxpayer; a sum that is even more than the average individual has paid by way of the carbon tax. And now Prime Minister Justin Trudeau’s plan will reduce the carbon tax’s impact on heavy industries that are faced with competitive pressures from other countries such as the United States that do not impose a tax on carbon.
This federal tax grab will only apply to provinces which don’t have their own plan, but with United Conservative Party Leader Jason Kenney’s promise to scrap the Alberta carbon tax, we might fall under the federal plan by default.
But that in itself is not my concern. I have no objection to an increase in the price of gasoline or other carbon-emitting substances but only if the revenue generated is, in fact, going to reduce our carbon footprint. This business of taking money out of one pocket only to put it back in another pocket is just an election ploy. What government doesn’t tell you though is that you won’t actually get the money back, it will only be a tax credit, so again the federal plan becomes a wealth transfer. But what are the costs involved in collecting this revenue from carbon intensive industry and then giving it back to the taxpayer?
At least when Premier Ed Stelmach set up Alberta’s own carbon tax back in 2007, it was a pure tax on emissions intensity without all this hocus pocus of taxing everyone and giving some or all of it back, which just creates a bureaucratic money laundering scheme. Under Stelmach’s scheme, $2 billion was subsequently set aside under the Carbon Capture and Storage Funding Act for a carbon sequestration scheme as well as to fund urban transit.
There is no question that if you tax the emitters, that in the end the consumer pays and so we should, as the user of the product. The carbon that comes out of your tailpipe is the end product of the extraction and manufacturing process so everyone is responsible for the problem and everyone should rightly pay.
Heavy users will naturally pay more than light users so a wealth transfer is unnecessary. The high rollers will automatically pay more than the little guy and that’s fair ball, in my opinion.
So, will the carbon tax save our environment? Not in its present format – it will only create more bureaucracy and trick the unsophisticated voter! And because our neighbour to the south does not impose a carbon tax, it will most definitely put us at an economic disadvantage.
Ken Allred is a former St. Albert alderman and MLA.
