By  Franco Terrazzano 

The Canadian Taxpayers Federation applauds Conservative Party Leader Pierre Poilievre’s promise to end all carbon taxes, including the industrial carbon tax, if he becomes prime minister.

“Poilievre is right to oppose the hidden industrial carbon tax that makes everything more expensive and costs Canada jobs,” said Franco Terrazzano, CTF Federal Director. “Canadian businesses are already struggling to survive massive tariffs and hidden industrial carbon taxes make them even less competitive.

“A carbon tax is a carbon tax is a carbon tax, and Canadians can’t afford to keep paying more to fuel up their cars, heat their homes and buy groceries.”

The federal government imposes an industrial carbon tax on oil and gas, steel and fertilizer businesses, among others.

Today, Poilievre said a Conservative government will “repeal the entire carbon tax law, including the tax on Canadian businesses and industries.”

During the Liberal Party leadership race, Prime Minister Mark Carney said he would “improve and tighten” the industrial carbon tax and “extend the [tax’s] framework to 2035.”

“So in changing the carbon tax … we are making the large companies pay for everybody,” Carney said.

However, just 12 per cent of Canadians believe businesses pay most of the cost of the industrial carbon tax, according to a recent Leger poll  commissioned by the CTF. Meanwhile, 70 per cent said businesses would pass most or some carbon tax costs on to consumers.

“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,” Terrazzano said. “Canadians can’t afford a carbon tax on businesses, which will mean higher prices, fewer jobs and less production in Canada, especially during a trade war.

“Poilievre deserves credit for being the only federal leader committed to ending all carbon taxes.

From the Fraser Institute

By Jake Fuss

President Trump’s tariffs have prompted renewed interest among federal and provincial policymakers to remove interprovincial trade barriers in Canada to mitigate some of the economic damage. But whatever happens with U.S. policy, with a new prime minister and a federal election looming, trade liberalization within our provincial borders is long overdue.

For decades in Canada, government policies have created substantial barriers to investment, trade and migration between provinces and territories, which hinder the free movement of workers, goods and services in Canada and limit economic growth.

These trade barriers include differences in licencing recognition and safety rules, trucking regulations, credential recognition, provincial monopolies over alcohol distribution, and strict restrictions on the sale of certain goods across provincial borders. This complex array of policies, unique to each province and territory, creates compliance challenges, additional costs for businesses and higher prices for consumers.

According to a 2019 report from the International Monetary Fund, internal trade barriers add between 7.8 per cent and 14.5 per cent to the prices of goods and services purchased by Canadians—that’s more than the GST (5.0 per cent). The harm to the broader economy is also no secret. Research by Ryan Manucha and Trevor Tombe estimates internal trade barriers cost the national economy as much as $200 billion annually.

And when workers are able to use their credentials obtained in one province to get jobs in other provinces, they have more opportunity. At the same time, businesses benefit from an expanded pool of qualified workers.

Again, provincial premiers and federal representatives recently met to discuss reducing trade barriers. For example, the federal government announced plans to strengthen the Canada Free Trade Agreement (CFTA)—a 2017 agreement intended to eliminate barriers for the movement of people, goods and services within Canada. The CFTA has been plagued with an abundance of exceptions that allow Canadian governments across the country to exclude many industries (i.e. dairy and poultry) or specific legislation from the agreement. The government has pledged to remove more than half of these exceptions to allow for more consistent rules and regulations across provinces.

While this is a step in the right direction, it doesn’t go nearly far enough. Working alongside the provincial and territorial governments, federal policymakers should propose a policy of “mutual recognition” so any good, service or professional credential that meets the regulatory requirements of a single province or territory automatically satisfies the requirements of another.

Research shows mutual recognition would increase Canada’s GDP per person—a broad measure of living standards—between $2,900 to $5,100 over the long term.

Provinces can also act on their own through bilateral or multilateral partnership agreements to harmonize regulations and improve worker mobility. One option is to expand the scope of the New West Partnership Trade Agreement (NWPTA) between British Columbia, Alberta, Saskatchewan and Manitoba, and include more provinces in the agreement.

Given President Trump’s aggressive stance on tariffs, federal and provincial policymakers must create an integrated internal trade market in Canada to offset some of the potential economic damage. By eliminating trade barriers, governments across the country can help increase the ability of workers and businesses to prosper, decrease prices, raise household incomes and improve living standards.

Jake Fuss

Director, Fiscal Studies, Fraser Institute