Science

Ottawa eases carbon tax thresholds to help Canada’s big industries compete

Ottawa eases carbon tax thresholds to help Canada’s big industries compete

The federal carbon pricing system for heavy emitters, softened last week to ease the impact on Canadian industry, could be amended even further this fall as Ottawa looks to address competitiveness fears in corporate Canada fuelled by US tax cuts, tariffs and environmental policy roll backs.

"But it's already on trial among the families who will be forced to pay more for gas, home heating and everything else if the federal government gets its way", said Mulroney, who previously supported a plan to tax carbon emissions under former Progressive Conservative leader Patrick Brown.

The new guidelines would allow some of these companies to pay a carbon tax on only 10 to 20 percent of their CO2 emissions, down from a 30 percent benchmark.

Ford vowed to fight Ottawa's carbon pricing plan and eliminate Ontario's cap-and-trade system during the spring election campaign.

But those reductions weren't enough to sway opponents. The provincial government says it's not opposed to reducing emissions, but argues that the tax is unconstitutional.

FILE PHOTO: Catherine McKenna, Minister of Environment and Climate Change in Canada, answers a question during the Concordia Summit in Manhattan, New York, U.S., September 19, 2017.

"We consulted broadly with industry", Caroline Theriault said in a statement.

"We've been clear since the beginning that we would be consulting with industry and environmental experts to find the best ways to reduce emissions, improve energy efficiency, and stay competitive - and that's exactly what we've done".




The Ford government greeted Ottawa's move to scale back a federally mandated carbon tax as a victory for the Premier.

"This climb-down by the federal government is a signal that we have been right all along", Ontario Environment Minister Rod Phillips said during Question Period on Wednesday.

The factum characterizes the federal legislation, called the Greenhouse Gas Pollution Pricing Act, as "unprecedented in Canadian history".

"The federal carbon tax will have its day in court. We are committed to providing draft regulations in Fall 2018".

But Scott Moe still wants Ottawa to cancel the tax entirely. "The economy in Saskatchewan is different than the manufacturing economy in Ontario, and is different than economies of Atlantic Canada", Moe said.

The system would have companies whose emissions place them below the cap earn credits they could trade with companies that come in above it. Companies above the cap can innovate to reduce their emissions, buy credits to offset their emissions, pay the carbon price on emissions over the cap, or some combination of the three.

However, the new rules set to take effect in the new year will increase the carbon tax threshold to 80 per cent of emissions intensity.


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