Liberal politicians seem to think the problem with the carbon tax is that people can see how much it costs them.
The real problem is that people can see the big glowing prices at gas stations and they wince when they open painful heating bills that are hitting mailboxes right now.
Unless the Liberals scrap the carbon tax entirely and make those costs come down dramatically, they haven’t solved the carbon tax problem.
So far, it seems like Liberal leadership candidates are struggling to grasp that reality.
“No more consumer-facing carbon tax,” Chrystia Freeland said on Toronto’s CP24 news channel. “Where people have a consumer-facing price on carbon they’re saying, ‘You know, we don’t like it.’”
Is Freeland’s only issue with the carbon tax is that Canadians see the cost every time they go to the gas pumps or pay for their home heating? Is Freeland going to re-label the carbon tax and try to hide its costs?
Alarm bells should be ringing after Freeland’s interview with the Journal de Montreal.
“Quebec has an excellent climate action plan — the carbon market,” Freeland said. “In provinces where a carbon price is directly passed on to consumers, Canadians are making it clear – they don’t want it.”
Freeland added, “Quebec has shown how effective this approach can be” and “we need that kind of approach in the rest of the country.”
Freeland is referring to Quebec’s cap-and-trade carbon tax.
Under cap-and-trade, the government creates an artificial market and mandates a certain level of emissions. The government-mandated emissions cap determines the carbon tax a company must pay to buy credits. Those costs are then passed on to people through higher gas prices and heating bills
The Carbon Tax Center calls cap-and-trade “an alternative approach” to putting “a price on carbon.”
Cap-and-trade is a carbon tax by another name. The costs are hidden, but terribly real for anyone fueling up their car or paying their heating bill.
“Politically, cap-and-trade has functioned as a ‘safe harbour’ for politicians who grasp the need to price carbon emissions but cling to the need to ‘hide the price’ to appease interest groups and/or voters,” according to the Carbon Tax Center.
“The costs of cap-and-trade systems can easily become a hidden tax.”
Quebec’s cap-and-trade carbon tax increases the price of gasoline by 12¢ per litre, the price of diesel by 15¢ per litre and the price of natural gas by 9¢ per cubic metre. And just like with the carbon tax, politicians can hike cap-and-trade taxes.
There are no rebates under Quebec’s cap-and-trade scheme.
The parliamentary budget officer issued three reports proving the carbon tax costs average families hundreds of dollars more every year than the rebates they get back. But at least some Canadians now get some of their money back. Even that paltry return wouldn’t happen if Freeland imposed a Quebec-style hidden carbon tax.
Canadians must also watch for a shell game from Freeland’s leadership rival, Mark Carney.
“If you are going to take out the carbon tax, we should replace it with something that is at least, if not more, effective,” Carney said.
The carbon tax has been very “effective” at draining Canadians’ wallets. What “more effective” replacement scheme is Carney considering?
Long-time carbon tax cheerleader and Environment Minister Steven Guilbeault, who endorsed Carney for Liberal leader, said if the carbon tax is scrapped, “it will have to be replaced with something else.”
Guilbeault hasn’t named that replacement, but he’s also bragged about Quebec’s hidden carbon tax.
“Quebec is showing the world that putting a price on carbon pollution is the simplest and most cost-effective way to fight climate change,” Guilbeault said in July.
The problem with the carbon tax isn’t that the costs are visible, it’s that the costs are all too real for people fighting to afford the basics.
Liberals shouldn’t create hidden carbon taxes. They should scrap carbon taxes completely.
Franco Terrazzano is the Federal director and Kris Sims is the Alberta director of the Canadian Taxpayers Federation