When it comes to Canada and carbon taxes, times have certainly changed in very little time.
Photo by Sean Kilpatrick/The Canadian Press
We had wondered how long Ottawa’s national carbon-tax system would last when, after implementing it as a mandatory national scheme, the feds suddenly announced an exemption for home heating oil in Newfoundland and Labrador.
Pressed by NL Premier Andrew Furey, a Liberal, and Liberal MP Ken McDonald, Prime Minister Justin Trudeau announced the exemption last October, saying it would help Atlantic Canadians with the cost of living.
The exemption would last until March 31, 2027. And for NL households that burn oil, the feds said it would mean an average $250 annual savings.
Alberta and Saskatchewan saw the exemption as unmitigated vote-buying politics, and they weren’t alone.
On Jan. 1, 2024, Saskatchewan stopped collecting the federal carbon tax on natural gas used for home heating in that province. Premier Scott Moe declared that this was in response to Ottawa’s “unfair” exemption for Newfoundland and Labrador.
“Trudeau has provided a carbon tax exemption on home heating for families in one part of the country, but not here. It’s unfair, it’s unacceptable.”
Saskatchewan went on to challenge the exemption, in federal court, on constitutional grounds, and won a temporary injunction. Later, pending a final court decision, Saskatchewan and Ottawa agreed that the province would be responsible for “50 percent of the outstanding tax amounts.”
But Ottawa’s carbon tax (oops, sorry, Ottawa likes to call it “carbon pricing” and “carbon pollution pricing”) has now run into new political trouble.
First, national NDP leader Jagmeet Singh, who had voted for the carbon tax, pulled out of a deal supporting Trudeau’s Liberal Party in government.
Singh then went on to slam Trudeau’s approach of exempting fuels in favored geography. And he said the NDP would come up with a system that doesn’t “put the burden on the backs of working people.”
Then, British Columbia Premier David Eby, long a strong supporter of the carbon tax — but facing an election on Oct. 19 — suddenly declared: “I think it's critical to also recognize that the context and the challenge for British Columbians have changed. A lot of British Columbians are struggling with affordability.
"If the federal government decides to remove the legal backstop requiring us to have a consumer carbon tax in British Columbia, we will end the consumer carbon tax in British Columbia.”
Would Prime Minister Trudeau remove the backstop requirement?
Apparently not. Instead, Environment and Climate Change Canada is looking to run a $7-million “climate literacy and action” advertising campaign to promote the carbon tax and the quarterly rebates that many Canadians receive under it.
And the prime minister, earlier this year, declined to meet the premiers of Alberta, Ontario, Saskatchewan, New Brunswick, and Newfoundland and Labrador on the issue.
"The carbon tax has contributed to increasing stress and financial pain for millions of Canadians," Alberta Premier Danielle Smith wrote to the prime minister.
Ontario Premier Doug Ford wrote: "While we all have a role in protecting the environment, it cannot be done on the backs of hardworking people."
But Trudeau turned down the call for a meeting: "We had a meeting on carbon pricing and every single premier came together to work on establishing a pan-Canadian framework on climate change years ago.
"And part of it was that there would be a federal backstop to make sure that pollution wasn't free anywhere across the country."
Whether the carbon tax has “worked” or not to reduce pollution is an open question. Supporters say yes. Opponents say no.
A poll late last year found that Canadians were feeling slightly more confident in the carbon tax’s effectiveness at combating climate change — but uncertainty was still high.
But the Liberal government is already getting a message from voters — having lost in two recent by-elections in Manitoba and Quebec, and in an earlier one in a “safe seat” in Ontario (Toronto-St. Paul’s).
In the Quebec one on Monday, the Liberals lost their longtime safe seat of LaSalle—Émard—Verdun to the NDP, by just over 200 votes. It had been a Liberal stronghold for years, won by more than 20 percent of the vote in previous campaigns.
The next federal election will take place on or before October 2025, and Trudeau’s opponents have already been loudly cranking up “Axe the Tax” campaigns.
And that means the carbon tax.