Philip Cross: R.I.P., Canadian carbon tax
With both the federal NDP and B.C.’s NDP government backing away from support for the carbon tax, it is time to pronounce the tax politically dead in Canada, with precise funeral arrangements to be made after the next federal election. Conservative governments across Canada have long opposed a carbon tax, and federal leader Pierre Poilievre is anxious to fight the next election on the issue. But now even Liberal support is flagging, with Newfoundland’s Liberal government attacking the tax as too costly for households. The federal Liberals themselves acknowledged the tax was a problem when they provided a carve-out for home heating oil, which is heavily used in Atlantic Canada.
In 2015 the Trudeau Liberals won a majority government while promising a carbon tax to be built on carbon emission levies already in place in Canada’s four largest provinces. Less than 10 years later, carbon taxes are toxic with the public and the Liberals are increasingly isolated in defending them. If Poilievre is elected, he will stop compelling the provinces to tax carbon. With B.C. signalling it will abandon any carbon tax not mandated by the federal government, Quebec’s cap-and-trade system would be the only carbon pricing left for households. But consumers in Quebec will soon notice their fuel prices are higher than in neighbouring Ontario and New Brunswick, and that will create strong pressure to follow Ontario, which abandoned cap-and-trade in 2018, and look for other strategies to lower emissions.
How did the carbon tax become so unpopular?
It never had widespread public support to start with, even if many economists endorsed it enthusiastically and naïve political pundits pushed the faulty argument that a majority of Canadians voted for
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