[BC] Finance Minister Carole Taylor introduced an escalating carbon tax on most fossil fuels Tuesday, one she says recycles revenues back to taxpayers and businesses and is designed to ignite an environmental social movement in British Columbia and across Canada to fight climate change.
This is the type of policy that could truly make a difference in the amount of greenhouse gas emissions produced in BC. The most impressive aspect of this tax is that it seems to be implemented properly, unlike the carbon tax introduced in Quebec which attempted to shield consumers from any increase in fuel charges thus preventing it from achieving a reduction in greenhouse gas emissions.
As part of the new tax plan, carbon-based fuels — including gasoline, diesel, natural gas, propane, coal and home heating fuel — will be taxed at $10 per tonne of greenhouse gases generated, starting July 1, 2008.
That will translate into a new 2.4 cents per litre tax on gasoline at the pump and 2.8 cents per litre for home heating fuel.
The carbon tax rate will rise by $5 a year for the next four years, until it hits $30 per tonne of greenhouse gas generated in 2012, said Taylor…
The tax will earn the government an estimated $1.85 billion over three years, but Taylor said the plan will be revenue neutral. The government will give all of the money back to taxpayers in the form of tax breaks, she said.
Despite the positive initial impressions of this tax, there are two issues which could limit the effectiveness of this tax:
- First, as with any such policy, it is important to know what loopholes exist, and what percentage of carbon emissions are captured by this tax. If significant loopholes exist (as the NDP as suggested) and if a significant portion of greenhouse gas emissions are not captured by this tax its effectiveness could be undermined.
- Secondly as far as I can tell this tax is only set to increase until 212, at which point the tax will be $30 per tonne of CO2, a figure that is far to low to achieve the necessary cuts to CO2. What is needed to truly lower emissions is a tax that increases for a much longer period of time and arrives at a higher tax rate for greenhouse gas emissions, and while there is no reason future politicians can’t implement these changes it is disappointing that the current tax increases end in 2012.
Before the typical anti-climate-change crowd gets all riled-up and begins claiming that this is nothing more than a left-wing socialist plot, it is worth remembering that Gordon Campbell and the BC Liberals are a right-of-center party and that many right wing think tanks such as the American Enterprise Institute have publicly called for the implementation such a carbon tax.
Despite the hysterical lefty bashing by self-interested think tanks, and despite the self-righteous rhetoric of centre-left politicians and supporters: in Canada, as in the United States, a left coast right-winger is leading the way – making the kind of foundational policy shift that could finally begin to turn the fossil fuel supertanker around… Let’s hope this sanity is contagious.