Prime Minister Justin Trudeau is holding firm on the federal carbon price, telling premiers the carbon price and associated rebates will increase as planned despite months of relentless attacks from the Conservative Party of Canada and many provinces.
In a letter sent Tuesday afternoon to premiers seen by Canada’s National Observer, Trudeau said his government knows Canadians want to fight climate change and stood by the policy.
“The devastating effects of floods, wildfires, and droughts are escalating costs annually, destroying homes, ravaging communities, and inflating the prices of food and consumer goods,” the letter reads. “Putting a price on pollution is the foundation of any serious plan to fight climate change. It is the most efficient way to reduce emissions across the economy — from industry to transportation to buildings and businesses.”
The letter says it “is critical to dispel the misconception” that the carbon price is driving affordability concerns, and that according to the Bank of Canada, the carbon price accounts for approximately 0.1 per cent of annual inflation.
“Since Canada’s carbon pricing system was first introduced in 2019, we have made it clear that we are open to working with any and all provinces and territories that want to establish their own pricing systems (as long as they meet or exceed the national benchmark),” the letter adds. “When we last engaged with provinces and territories on this in 2022, all of your governments either did not propose alternative systems or (with the exception of New Brunswick) proposed systems that did not meet the minimum standard for emissions reductions.
“However, we continue to remain open to proposals for credible systems that price pollution that reflect the unique realities of your regions and meet the national benchmark.”
Provinces that have demanded the carbon price increase be paused include Alberta, Saskatchewan, Ontario, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador.
The letter is the federal government’s most forceful response to date to some provinces' calls for a pause on the planned April 1 carbon price increase from $65 to $80 per tonne of CO2.
Since the carbon price was put in place in 2019, the tax on each tonne of carbon pollution has increased every year. It started at $20 per tonne and if the planned trajectory holds, it will climb to $170 per tonne by 2030. The purpose of the policy is to make planet-warming greenhouse gas emissions steadily more expensive to incentivize investments in clean alternatives.
At the same time a carbon tax is levied, a rebate is provided to Canadians that returns more money than is taxed to 80 per cent of households. Typically, only the most wealthy Canadians find themselves out of pocket due to their disproportionate fossil fuel consumption.
The carbon price is significantly lower than federal estimates of the “social cost” of carbon — a metric used in cost-benefit analyses that helps capture the impact of planet-warming greenhouse gas emissions. It includes things like the damage to human health, agricultural productivity, property damage from natural disasters, energy system disruptions and the climate benefits of ecosystems.
This year, the federal government estimates the social cost of one tonne of carbon dioxide pollution at $266 and one tonne of methane at $2,494.
Trudeau’s response to premiers demanding a price freeze comes as the government’s central climate policy finds itself on life support after months of blistering attacks from Conservative Leader Pierre Poilievre.
Poilievre’s anti-carbon price politics reached a fever pitch last week when his party tabled a motion calling on the federal government to cancel the planned increase and days later, filed a non-confidence motion that if successful would have toppled the government. It failed, but experts told Canada’s National Observer it didn’t need to succeed in order to serve its purpose of helping to frame the next election as a referendum on the carbon tax.
As Trudeau tells the premiers the carbon price will continue as planned, all eyes are on how Ottawa will respond to Saskatchewan after Premier Scott Moe instructed Crown utility SaskEnergy not to apply the carbon tax on consumers — a choice to break federal law. Tuesday’s letter did not reference Saskatchewan specifically.
In late February, Dustin Duncan, the minister responsible for SaskEnergy, confirmed the province would not pay the federal carbon price levy it owed Ottawa. He said the decision to stop collecting the carbon tax from customers was a way to offer relief to families following the federal government’s carbon price exemption on home heating oil, predominantly used in Atlantic Canada.
When Duncan made the comments, Natural Resources and Energy Minister Jonathan Wilkinson said by choosing not to collect the carbon tax, Saskatchewan residents would lose out on the rebates that are provided. The carbon price rebate would provide $1,500 on average to a family of four in Saskatchewan — a notably higher amount than the $400 saved by ditching the carbon tax that Duncan said would be achieved.
The Saskatchewan government’s decision set the stage for one of the tensest political battles over climate policy this country has seen. When Moe first announced his government would buck federal law, University of British Columbia political science professor Kathryn Harrison told Canada’s National Observer she was horrified by the prospect.
“This is an extraordinary moment in Canadian democracy that a government, a provincial government, would choose to break a constitutional federal law,” she said at the time.
In an interview with Canada’s National Observer last week — when the federal government was fending off attacks from Poilievre and seven premiers calling on the federal government to pause the carbon price at its current level or scrap it entirely — Wilkinson said responding to Saskatchewan was an “active conversation.”
“This isn't about throwing the premier in jail, but there have to be consequences for the province of Saskatchewan, the government of Saskatchewan, if they're going to simply break the law,” he said.
“I find it utterly appalling that a provincial premier would knowingly flout the law, and I just do not understand how Premier Moe can get his head around the idea that somehow he can pick and choose which laws he abides by and yet he expects citizens of Saskatchewan to abide by the laws that are passed through the provincial legislature.”
Comments
“This isn't about throwing the premier in jail"
. . . Why not? He's breaking the law. He chose to break the law, he has stated he's aware that what he proposed to do breaks the law, nobody else made the decision to break the law, the authority, ability and responsibility are entirely his. If he then goes ahead and breaks the law, why does he not personally take the consequences? Because he's prominent and powerful?
My interpretation is that "throwing the premier in jail" is not the first thing the feds would do. Just like if you don't pay Revenue Canada all the taxes you owe, you don't get tossed in jail right away (if ever). Yes, Moe is breaking the law, and it is my understanding he is willing to accept accountability (and not expect SaskEnergy to take the blame). So, like any "white collar crime", shouldn't the RCMP investigate?
Because it's not the kind of law-breaking for which the law-breaker lands up in jail.
It's also against the law for dog owners to let their dogs run on the school ground, or in my yard, much less to allow their animals to empty their bowels there and not "stoop and scoop" ... or to simply toss the bagful into a yard or behind a tree.
I'd be happy to see a new offence or two added to the Criminal Code of Canada, though!
Good for our PM. If we can't afford a carbon tax where most people get more money back than they spend.......we're toast. And these right wing luddites (look it up!) need to be defeated at the polls.....though they might not be, the level of ignorance that deregulated capitalism has brought with it, being what it is.
We have panels and an EV..........we make money off the carbon tax....and are waiting for resentful know nothings to start wailing about that. Come to think of it, in Alberta they already are.
What's happened with the rule of law, foundation of democracy, is currently seen in the captured U.S. Supreme Court. It's where the reform cons here are heading as well; recall Harper's unprecedented attacks on the judiciary, it's the centre that is NOT holding. Look at what's happening with Trump at the moment; he's deliberately and repeatedly undermining the entire American justice system by claiming it to be "weaponized" against him because he's up in the polls and "they" don't want him to win!
As the highest body in the legal system, the U.S. Supreme Court is now modelling the transformation that has been underway for decades, where all the legal education, experience and expertise of the sitting judges is, if not uniformly "trumped" by (at this level more professional integrity exists), at the very least watered down, tempered, and/or informed, (i.e. "captured") by the "divine law" of religious myth, predominantly Catholicism in this case. This sanctions their constitution as well; it's perceived as being "god-given." So what could go wrong with such an irreconcilable dichotomy now HAS. Talk about the "bully pulpit."
But the true believers running the religious right are going for broke now, having gained maximum public power, the sanction THEY have needed to validate THEIR "big lie" that they SO want to believe for personal comfort, but also imagining that it will restore "order." So to that end they're willing to follow even the very cloven foot of a true scoundrel like Trump, who has in turn opened the floodgates for the mob of rabble-rousing, libertarian and anarchic right that the whole American myth has naturally spawned. It's "fun" so they are duly entertained.
Scott Moe embodies the current conservative dichotomy, is as self-righteous as they come, but is also the poster boy for stupid anarchy, so it's a real treat to see Wilkinson speaking thoughtfully and in an adult, measured way from his VALID bully pulpit about what to do with such unprecedented, upstart and juvenile insurrection. The fact that the con premiers have now inexplicably been joined by several actual and potential progressive leaders is probably what has made the federal government realize that it needs to start throwing ITS weight around now.
It remains to be seen how much Moe's constituents will appreciate losing their "gas tax" rebates.
Given what I see charged for furnace fuel, I'm pretty sure that there's an awful lot more "embedded" carbon taxes in necessary goods and services, than the $400 and change returned to me annually.
@f nordvie: Indirect carbon costs — fuel charges on goods and services paid by businesses — are pooled with consumer fuel charges. 100% of carbon revenues are returned to the province of origin. 90% of carbon revenues are returned to households. Businesses do not get the consumer rebate.
Your carbon rebate includes indirect carbon costs — fuel charges on goods and services.
Good comments thus far. Like the Prime Minister I wonder if not a price on carbon then what? No viable, workable, realistic, or concrete suggestion or solutions have been proposed / made by the politicians who only care about themselves! Yes, let us score points with catch phrases and ignore and obfuscate the truth. There is a climate crisis and CLIMATE CHANGE IS REAL!!
What is going to be done to protect our communities, provinces and territories and our country if we do not continue with carbon pricing now? What kind of future will the children and young people of tomorrow face?
In my view all those provincial and federal politicians who are advocating for the stoppage should read 'Our Common Future' - Brundtland Commission (1987) https://sustainabledevelopment.un.org/content/documents/5987 to see that the world is really a connected place with connected systems and their cries for stoppage will not only hurt and harm their provinces, but it will do the same and more to Canada and to the world.
Climate change is real, of course, and has been for a long, long, lo-ongg time.
But a "gas tax" doesn't deter the gas & oil cos. from producing more and more of the stuff.
By now, I hope none of us are misinformed enough to believe that the "gas tax" is in any way reducing carbon emissions.
It needs to be remembered that the current form of "carbon tax" is just exactly what the oil-gas cos. ordered. They didn't want to be charged directly, and threatened to pass the costs on to consumers. Our esteemed government according to its ongoing policy of subsidizing and hopping to the demands of the Big Polluters, hopped to and did their bidding. Just as they did when Mulroney brought us the GST.
As far as what other than a "gas tax" would "protect" the futures (questionable) of the children of today, let alone the children of tomorrow, might I humbly suggest the gov't's growing some cojones and get with the program of reducing gas and oil production and distribution. They *could*, for instance, focus their spending on Canadian businesses and people, instead of handing out truckloads of cash to foreign entities to poison us all and ship what they produce elsewhere. I'm all in favor of producing what we need, while rapidly reducing production.
But I don't think anyone believes any more in "using the profits to pay for" transition and climate change measures. If there ever was a horse with that name, it left the barn and ran into the sea a long, long time ago.
I'm sure people other than Yours Truly have observed that everyone's in favor of climate measures: as long as they don't have to change their habits or pay more for a better planet. Because, y'know, everyone *deserves* at least 2 long trips a year, to far away places, so their kids can "experience being global citizens." Globe-killing citizens, more like it.
Good points. The first step is for governments around the world to stop giving fossil fuel corporations direct and indirect subsidies to the tune of $7 TRILLION per year (IMF 2023). In Canada, "[t]he federal government provided at least $18.5 billion to the fossil fuel and petrochemical industries last year [2023], according to a new report by Environmental Defence" (CNO, 27 March 2024).
I mean, they've received a century of corporate welfare! So when are FFs finally going to be able to stand on their own two feet?
Next step. People need to be made aware that fossil fuels would be unaffordable if FF corporations had to internalize all the social (health) and environmental "costs" (the damage and destruction they cause) that they currently externalize (the "indirect" subsidies that we give them). Governments around the world have to start charging the carbon tax at source, to ensure that these costs are internalized. The FF companies will then pass on those costs to consumers (cuz they sure as heck won't accept any cuts to their profits) — and consumers will naturally start turning to cheaper alternatives.
Finally, I'm not sure if this is a carrot or a stick, but the federal government needs to pull a Little Red Hen, telling provinces, "If you don't help plant, tend, harvest or grind the grain, you don't get to eat the bread." No carbon tax? Then no federal help when the climate emergency comes calling. Not punitive. Not a punishment. Just a logical consequence of not participating in and contributing to this particular fund.
But Ottawa HAS to stop subsidizing fossil fuel corporations first. The carbon tax is a cruel irony until then.
I was born in Saskatchewan seven decades ago. It was ruled then by Tommy Douglas who led North America's first social democratic government. He introduced the continent's first public health insurance program that saved thousands of lives and hundreds of families from bankruptcy over medical bills. He introduced other public programs that benefitted SK residents over corporate interests.
He did all that while producing 21 successive balanced budgets. I believe Douglas would have acted on climate science without question if global heating was an issue during his premiership.
Today's Saskatchewan is a much different country led by a morally deficient government. I see the provincial leadership moving from Father of Medicare to Lawbreaker as one definition of "devolution."
Trudeau and minister Wilkinson are to be commended for standing up for their principles, for engaging the rubes with intelligence instead of political slogans, and for standing up for the rule of law.
We all know it's only the low hanging fruit of a carbon tax, and that climate action needs to be so much more. But this little step (with one misstep in an Atlantic province) garnered a pushback tsunami from political opponents who clearly won't admit they need the federal government to exist because they wouldn't survive on their own in a much bigger world that is clearly ramping up a major transition in energy to defeat carbon emissions.
Minister, sue their pants off.
A well-written comment. Thank-you.
Common sense, foresight and critical thinking are lacking in some who cannot see how climate change is an existential threat and the only real option is to move away from the forms of energy that create these emissions.
Morally deficient, yes. And seemingly intellectually deficient as well.
And rule of law is great, as long as it's applied to others, eh? Frankly, a politician who's done some of the shenanigans that JT has done has no moral right to utter the phrase.
A familiar refrain in the comments here that is tribal NDP/Green and so never mitigated by past AND current circumstances or the realities OF our political system from whence ALL comes.
Eschewing steadfastly the truth-- that politics in a democracy, never more than NOW, absolutely IS "the art of the possible," and from the relentless, virtue-signalling moral high ground of the perfection we'd all love to have, the tribal left (and more and more in this binary time the problematic left with their dubious trademark, the narcissism of small differences proudly intact) methodically trashes the only GOOD available to us.
And this despite their federal counterparts coming to their senses finally, and JOINING with what is, again, inarguably, the natural governing party in this country of progress and progressives, with long-sought "socialist" wins like dental care and pharmacare, ignoring the child care that the Liberals, also PROGRESSIVES FFS, did on their own.