With Canada at risk of a major recession because of U.S. President Donald Trump’s irrational declaration of a tariff war against us, there has never been a better time to kill Prime Minister Justin Trudeau’s carbon tax than right now.
News on Thursday that Trump has reversed himself again, delaying tariffs on most Canadian and Mexican goods until April 2, changes nothing.
The threat of tariffs is already damaging our economy.
The fact the Trudeau government, in its dying days, is proceeding with a scheduled 18.75% hike to the carbon tax on April 1 — increasing it to $95 per tonne of industrial greenhouse gas emissions from $80 per tonne — is economic madness.
That will raise the costs of 22 forms of fossil fuel energy paid for by Canadians, including hiking the cost of gasoline by 20.91 cents per litre and natural gas by 18.11 cents per cubic metre since the tax’s inception in 2019.
Canada’s parliamentary budget officer says that when one factors in the economic damage the carbon tax imposes on Canadians, most households pay more in carbon taxes than they receive in rebates.
Trudeau’s plan was to continue raising his carbon tax, which applies in every province except Quebec and B.C., which have federally approved pricing plans, until it reaches $170 per tonne on April 1, 2030.
That won’t happen because Conservative leader Pierre Poilievre has vowed to scrap the consumer portion of the carbon tax if he wins the next election, while the two leading candidates to win the Liberal leadership race — Mark Carney and Chrystia Freeland — have said they will come up with a better carbon pricing system than Trudeau’s.
Frontrunner Mark Carney says his plan will make “big polluters” pay but hasn’t explain how he will prevent these industries from passing along their increased costs to the public.
Plus, he’s proposing a tariff on goods coming into Canada — raising prices for Canadians — if their country of origin isn’t doing enough to fight climate change.
Freeland says she will come up with a new carbon pricing system in consultation with the provinces.
But any pricing system that puts a new charge on the emission of industrial greenhouse gases means the public ends up paying for it. There’s no free lunch.