ONE CARBON TAX FOR ALL
Ex-B.C. premier prods Ottawa
The man responsible for implementing North America’s first economywide price on carbon says it’s time for the federal government to put an end to provincial squabbles and impose one revenue-neutral, national carbon tax.
Gordon Campbell, who served as premier of British Columbia from 2001 to 2011 and brought in that province’s first-of-its-kind carbon tax in 2008, said it’s clear Prime Minister Justin Trudeau’s efforts to get provinces on board with the federal climate change plan are not working. He said the federal government should assert its authority now and impose one sweeping carbon tax on all provinces, even those that have come up with their own carbon-pricing policies.
“The problem the federal government faced is trying to involve all the provinces in some kind of patchwork solution,” said Campbell, who will be in Alberta this week to give a panel presentation at the annual Global Business Forum. “The federal government can act on its own … I think it’s important to act.”
The federal government has promised to impose a carbon tax starting Jan. 1, 2019, on provinces that haven’t developed their own provincial carbon-pricing system. Ontario and Saskatchewan have launched a constitutional challenge in response, while Alberta Premier Rachel Notley has said her province will no longer be a part of the federal climate plan unless the Trudeau government can get the Trans Mountain pipeline expansion project back on track.
But Campbell said even if all the provinces were willing to impose their own version of a carbon pricing scheme, the resulting hodgepodge of tax regimes across Canada would create unwanted barriers to inter-provincial trade. Since only a few provinces are on board with the federal climate plan anyway, he said, the Trudeau government should go ahead and impose its own version.
However, Campbell cautioned the key for any federal carbon tax will be if it is truly revenueneutral. He said when his government brought in the B.C. carbon tax in 2008, the province had to match every dollar of carbon tax collected with an equivalent cut to other taxes.
“All the studies suggested it had no negative impact on the economy when we did that, and it was revenue neutral,” he said, adding that under current Premier John Horgan’s government, revenues from B.C.’s carbon tax are now used to fund “green initiatives” and other programs. In Alberta, revenues from the carbon tax are being targeted toward rebates for consumers but also for renewable energy projects, transit and — beginning in 2021 — vital public services as the province works to pay down debt.
“The new government in British Columbia has taken away that revenue neutrality, and Alberta’s government doesn’t have revenue neutrality,” Campbell said. “But the federal government has income taxes. The federal government could easily say, ‘we’re going to reduce your income taxes for every dollar we take in on the carbon tax.’ They could do it tomorrow.”
Campbell — who also served as Canada’s High Commissioner to the United Kingdom from 2011 to 2016 — will be part of a Global Business Forum panel on the future of Europe post-Brexit. He said Brexit is partly the result of large numbers of people choosing to make decisions based on emotion rather than fact, a tendency that can also be observed in Canada. The B.C.Alberta rift over pipeline access, he said, is due in part to Horgan and his predecessor Christy Clark choosing to put politics over fact.
“They’ve decided this is going to be something they’re going to try to score political points on,” Campbell said. “But here’s the thing. Canada depends on a healthy and viable energy industry … Our job is to get the best quality of energy we can to global marketplaces.”
Campbell, who was premier of B.C. when Vancouver hosted the Winter Olympics in 2010, is also a proponent of a Calgary 2026 bid, calling it a “perfect opportunity for the city and province as a whole.
“It puts Alberta back in a leadership position, which I think is a pretty exciting economic opportunity, social opportunity and generational opportunity,” he said.
The Global Business Forum runs Thursday and Friday at the Fairmont Banff Springs.
All the studies suggested it had no negative impact on the economy when we did that, and it was revenue neutral.