Budget watchdog says carbon rebate will be more than carbon tax for most Canadians

Fuel surcharge was implemented this month in provinces that have not enacted carbon-pricing systems

A woman fills up her with gas in Toronto, on Monday April 1, 2019. Canada’s budget watchdog says revenues from the federal carbon price will be more than $2.6 billion this year and exceed $6 billion within five years. (THE CANADIAN PRESS/Christopher Katsarov)

Canada’s budget watchdog agrees with the federal government’s claim that Canadians are going to get more from the climate change tax rebate than they are paying in carbon tax.

The federal government implemented a fuel surcharge this month of $20 per tonne of emissions in the four provinces that have not enacted carbon-pricing systems of their own.

READ MORE: B.C. carbon tax up April 1, other provinces begin to catch up

The new analysis by the parliamentary budget office predicts that this year, the fuel charge will bring in more than $2.4 billion. Another $200 million will be raised from the tax applied to emissions from large industrial emitters, who pay it on a portion of their emissions above a level set by the government­.

In 2022-23, when the price hits $50 a tonne, the revenues will climb to $5.8 billion from the fuel charge and $448 million from large emitters. The four provinces involved are Saskatchewan, Manitoba, Ontario and New Brunswick.

The figures are very close to the government’s own projections for revenues. The Department of Finance predicted the fuel charge will bring in $2.36 billion in 2019-20 and $5.7 billion in 2022-23.

Ottawa has committed — and has now written into law — that 90 per cent of the revenues collected from the fuel charge will be returned to individual households in the provinces where the revenues were raised. The PBO report says over the next five years all but the wealthiest 20 per cent of Canadian households will get more back from the rebate than they will pay in carbon tax.

The rebates are the same regardless of income, but wealthier Canadians tend to own bigger homes, drive more and bigger cars, and consume more products, all of which contribute to a higher carbon tax total.

In Saskatchewan for instance, the average household is expected to pay $425 in carbon tax this year, and will get $598 back from the rebate. In Ontario, the average cost will be $256, and the average rebate $300. In Manitoba, the average cost will be $260 and the average rebate $336, and in New Brunswick the average cost will be $193 and the average rebate $248.

The wealthiest families in Saskatchewan, Ontario and New Brunswick will pay between $13 and $50 more in carbon tax than they receive from the rebate. In Manitoba, the wealthiest families will still be better off by $37, the PBO says.

The lowest-income families will get $70 more than they pay in Saskatchewan, $101 in Manitoba, $89 in Ontario and $63 in New Brunswick.

The benefits also grow almost every year, across every income group. By 2023-24, the PBO predicts the lowest-income households in Saskatchewan will get $131 more in rebates than they pay in carbon tax. In Manitoba, that group will be $214 better off; in Ontario, $195; and New Brunswick, $143.

The carbon tax is intended to encourage Canadians to find ways to reduce their carbon footprints, and therefore pay less carbon tax, without causing them economic hardship.

Environment Minister Catherine McKenna said Thursday the report confirms what the government has been saying about the rebates.

“A price on pollution works, it protects the environment for our kids and grandkids, and puts money back into the pockets of Canadians,” she said.

The carbon tax has become one of the hottest-button political disputes of 2019, with the Conservatives angling hard against it as an effective environmental measure and three of the four provinces with the federal tax now challenging it in court.

Mia Rabson, The Canadian Press

Like us on Facebook and follow us on Twitter

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Fast-food restaurants serving up free non-medical masks

Free protection will come in packages of four

Sylvan Lake Customs and Classics show cancelled

The annual Show and Shine was scheduled for July 11

Eckville salon adjusting to new normal after COVID-19 closure

Upper Cuts Salon has enforced new protocols and appointment schedules since re-opening

Alberta confirms 29 new COVID-19 cases

Of the total 6,955 confirmed cases, 652 are active

No increase in property taxes for Sylvan Lake residents

Town Council passes the 2020 Tax Bylaw at Monday’s council meeting

Facing changes together: Your community, your journalists

Sylvan Lake News is firmly committed to seeing you through the changes ahead, but we need your help

Facing changes together: Your community, your journalists

Sylvan Lake News is firmly committed to seeing you through the changes ahead, but we need your help

PODCAST: The Expert tackles the return of sports

Cam Moon, Joe Whitbread, Byron Hackett and Todd Vaughan discuss how sports can come back

More hospitals part of plasma transfusion trial to treat COVID-19 with antibodies

More hospitals part of plasma transfusion trial to treat COVID-19 with antibodies

Brazilians say ‘I do’ at drive-thru weddings to avoid virus

Brazilians say ‘I do’ at drive-thru weddings to avoid virus

Most Read