Axes and taxes
Cool Tips for a Hot Planet
Smokers pay extra taxes because smoking costs the health care system extra money.
We all breathe in the “smoke” (pollution) coming out of tailpipes, chimneys, and industries. And there’s a fee for that. Fortunately, unlike the tax on cigarettes, we get some of that money back via the Canada Carbon Rebate deposited in our accounts every three months.
Because Kawartha Lakes is a rural area, we get a 20 per cent top-up. My two-person household now receives $1,008 a year, or $252 every three months. For a family of four its $1,344 annually or $336 quarterly. Our 20-something daughter: $672 a year.
The carbon fee with dividend is also one way to nudge us in the direction of reducing planet-warming pollution. The costs of that have been hurting us for some time. Ten years ago, the former premier of Quebec said: “Nobody talks about the cost of not fighting climate change. This cost is passed on to citizens too, whether it’s health care, coastal erosion or spectacular weather events. This is hugely expensive for our society.”
Canada is not alone in pricing pollution. Worldwide, as of 2023, there were some 73 carbon pricing systems. They include the European Union with its 27 member countries. The EU is currently phasing in a border adjustment carbon tax on certain goods imported from countries without a price on carbon. So, we’re good.
But there’s a massive misinformation campaign that blames our carbon “tax” for everything from job losses to high food prices, to inflation, to forcing more people to use food banks. Really?
Look at food prices. The carbon fee increased on schedule in each of the last two years. In the same period, food price inflation dropped from over 10 per cent to 2.4 per cent. Our food price increases are similar to those in the U.S. – which has no carbon tax. Many other factors affect grocery prices, including drought (worsened by global heating), reductions in cattle herds, and supply chain issues, according to an overview in the Financial Post.
What about the impact of inflation in general? A new study from the University of Calgary shows carbon pricing had minimal impact on inflation between January 2019 and April 2024. During those five years, consumer prices rose 19 per cent. Changes in the carbon fee and other taxes contributed only 0.5 per cent to that increase.
As for being a job killer, hmm. Maybe not so much. Studies of carbon pricing in the United Kingdom and British Columbia indicate carbon fees change the types of jobs available, not the number of jobs.
Is it effective? Sweden began pricing carbon in 1991. The country’s environment ministry estimates that, over and above other climate regulations, their carbon tax has reduced emissions by 20 per cent.
According to economists, putting a price on carbon is the least costly way of addressing our climate goals. Those waving the axes haven’t come up with anything better, and would make climate chaos worse.
Bottom line: most Canadians benefit from our carbon fee and rebate system. That’s particularly true for those in the lower half of the income scale. Many people are hurting financially and axing the carbon “tax” means axing their rebates, which increase annually.
Canada’s Conservative lumberjack-in-chief likes to talk about axing things. But what kind of Canada would he be building?
