From the Fraser Institute

By Kenneth P. Green

Mark Carney, who wants to be your next prime minister, recently released his plan for Canada’s climate policies through 2035. It’s a sprawling plan (climate plans always are), encompassing industrial and manufacturing emissions, vehicle emissions, building emissions, appliance emissions, cross-border emissions, more “green” energy, more “heat pumps” replacing HVAC, more electric vehicle (EV) subsidies, more subsidies to consumers, more subsidies to companies, and more charging stations for the EV revolution that does not seem to be happening. And while the plan seeks to eliminate the “consumer carbon tax” on “fuels, such as gasoline, natural gas, diesel, home heating oil, etc.” it’s basically Trudeau’s climate plans on steroids.

Consider this. Instead of paying the “consumer carbon tax” directly, under the Carney plan Canadians will pay more—but less visibly. The plan would “tighten” (i.e. raise) the carbon tax on “large industrial emitters” (you know, the people who make the stuff you buy) who will undoubtedly pass some or all of that cost to consumers. Second, the plan wants to force those same large emitters to somehow fund subsidy programs for consumer purchases to offset the losses to Canadians currently profiting from consumer carbon tax rebates. No doubt the costs of those subsidy programs will also be folded into the costs of the products that flow from Canada’s “large industrial emitters,” but the cause of rising prices will be less visible to the general public. And the plan wants more consumer home energy audits and retrofit programs, some of the most notoriously wasteful climate policies ever developed.

But the ironic icing on this plan’s climate cake is the desire to implement tariffs (excuse me, a “carbon border adjustment mechanism”) on U.S. products in association with “key stakeholders and international partners to ensure fairness for Canadian industries.” Yes, you read that right, the plan seeks to kick off a carbon-emission tariff war with the United States, not only for Canada’s trade, but to bring in European allies to pile on. And this, all while posturing in high dudgeon over Donald Trump’s plans to impose tariffs on Canadian products based on perceived injustices in the U.S./Canada trade relationship.

To recap, while grudgingly admitting that the “consumer carbon tax” is wildly unpopular, poorly designed and easily dispensable in Canada’s greenhouse gas reduction efforts, the Carney plan intends to double down on all of the economically damaging climate policies of the last 10 years.

But that doubling down will be more out of sight and out of mind to Canadians. Instead of directly seeing how they pay for Canada’s climate crusade, Canadians will see prices rise for goods and services as government stamps climate mandates on Canada’s largest manufacturers and producers, and those costs trickle down onto consumer pocketbooks.

In this regard, the plan is truly old school—historically, governments and bureaucrats preferred to hide their taxes inside of obscure regulations and programs invisible to the public. Canadians will also see prices rise as tariffs imposed on imported American goods (and potentially services) force American businesses to raise prices on goods that Canadians purchase.

The Carney climate plan is a return to the hidden European-style technocratic/bureaucratic/administrative mindset that has led Canada’s economy into record underperformance. Hopefully, whether Carney becomes our next prime minister or not, this plan becomes another dead letter pack of political promises.

Kenneth P. Green

Senior Fellow, Fraser Institute

 By  Franco Terrazzano

Taxpayers are demanding to know how much Liberal Party leadership candidate Mark Carney’s carbon tax will cost after he admitted he would “change” the policy rather than scrapping the tax.

“After Carney led Canadians to believe he was getting rid of the carbon tax, now he says he’s going to ‘change’ it, so how much will his relabeled carbon tax cost?” said Franco Terrazzano, CTF Federal Director. “We know the cost of Carney’s carbon tax won’t be zero, so how much extra will people have to pay when they fill up at the gas station or pay their heating bills?”

Carney clarified his plans for the carbon tax in Kelowna, British Columbia, on Wednesday.

“The issue wasn’t, to coin a phrase, whether to ‘axe the tax,’ the issue was how to change it,” Carney said. “So in changing the carbon tax … We are making the large companies pay for everybody.”

Currently, the federal carbon tax costs about 17 cents per litre of gasoline, 21 cents per litre of diesel and 15 cents per cubic metre of natural gas. The carbon tax is set to increase on April 1.

The Parliamentary Budget Officer has repeatedly reported the carbon tax costs the average family hundreds of dollars more than the rebates they get back.

“Taxpayers have a simple question for Carney: What will happen to gas prices and home heating bills under his plan?” Terrazzano said. “Whether the carbon tax is up front or hidden, Canadians can’t afford to pay more to fuel up their cars, heat their homes and buy groceries.”

Carney is proposing to eliminate the visibility of the carbon tax on things like home heating bills, but to still hit businesses with the carbon tax.

Carney’s plan would cancel the carbon tax rebates and instead “create a system of incentives to reward Canadians” for making environmentally approved purchases.

“Carbon taxes on refineries make gas more expensive, carbon taxes on utilities make home heating more expensive and carbon taxes on fertilizer plants increase costs for farmers and that makes groceries more expensive,” said Kris Sims, CTF Alberta Director. “Conservative Party Leader Pierre Poilievre is promising to scrap the carbon tax and that will cut the price of gas by 17 cents per litre. Now Carney needs to be honest about how much his changed carbon tax will cost.”