Canada updates its carbon emissions tax policy

James Marshall
August 4, 2018

Those companies that emit more than their competitors will pay the carbon tax but can deduct either 80 or 90 per cent of their carbon tax burden.

The four sectors assessed in the high competitive risk category will not have to pay the tax until they reach 90 per cent of emissions.

The government of Saskatchewan has asked the province's Appeal Court to determine whether the federal government has the power to impose a carbon price, and Saskatchewan Premier Scott Moe has recently found an ally in recently elected Ontario Premier Doug Ford, who said at the premiers gathering last month that his province would join the legal fight.

The original proposal McKenna made in January was to set that cap at 70 per cent for all industry.

The Liberal government said the changed guidelines were aimed at addressing concerns among industries that are at a high risk of suffering from foreign competition. The federal system will only be applicable in provinces without a federally approved carbon price system of their own.

"The federal government would do well to go back to the Vancouver declaration where all first ministers signed on behalf of their provinces and territories to work collaboratively with different provincial plans to achieve our Paris commitments, not this made in Ottawa climate tax", he said.

"We see an effort by the federal government to water down this economic impact, but the fact remains a watered down poison is still a poison and this is economic poison", Moe said.

The Trudeau government has said it would use these powers as part of a national strategy to fight climate change and honour Canada's global commitments, supported by all political parties, under the 2015 Paris Agreement to reduce greenhouse gas pollution and prevent risky levels of atmospheric warming.

"You want a carbon-pricing system to do two things, first spur emission reductions and second, to have firms remain in Canada while they do that".

Corporate Canada may also get help this fall from Finance Minister Bill Morneau, who is spending the summer listening to a wide range of perspectives on Canada's competitiveness challenges.

Business associations want Ottawa to cut corporate taxes in Canada, arguing the USA tax changes could end up inflicting more damage on the Canadian economy than the possible termination of the North American Free Trade Agreement. "That's why we are committed to use all available tools, including the courts, to oppose the federal government's carbon tax".

Other reports by Click Lancashire

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