Describing his government’s new Federal Carbon Tax, Justin Trudeau is quoted as stating: “it will be revenue neutral for the federal government, with any revenues generated under the system staying in the province or territory where they are generated”
This sounds very disingenuous.
The carbon tax will raise the cost of fuel, which will raise the revenues of the province wherein fuel is consumed.
The provinces then will have at their discretion, the ability to cut taxes elsewhere (whether it works out that way, remains a whole other questions – I am doubtful, personally).
What seems the most insidious about the tax is that for provinces that depend on long haul transport for life essentials, the increased cost of the tax gets passed onto them, with none of the benefit of additional tax revenues.
This in effect a massive wealth transfer from the provinces that have long transport routes to the provinces with short ones.
For example, my daughters love apples.
It’s a staple on our breakfast table every morning. Most of the time, those apples are from British Columbia.
Those apples, probably picked in the Okanogan, were either loaded onto a flat bed truck and driven or loaded onto a train and railroaded here.
Regardless, either a truck or a train had to fuel up somewhere in British Columbia to get an apple to my dining table in Alberta.
With the carbon tax, when an 18 wheeler fuels up in Kelowna, the revenue from the carbon tax “stays in the province” paying for government services in British Columbia. The increased cost of the fuel, however, is priced into my grocery bill in Calgary when I go to CO-OP to buy my girls some apples for their breakfast.
It is not just groceries.
Go visit your local Rona (or in my case, Reno-Depot). Everything is manufactured in Quebec.
The increased cost of the carbon tax at every truck stop (or refueling station) between Montreal and Calgary is worked into the final price I have to pay for every sheet of drywall, every tile, every nail, and every screw.
None of the revenue from the tax pays for my kids’ schools, the roads I drive on, or the doctor in the delivery room where my next child will be born.
They “stay in the province” where the tax was collected.
In Alberta, Saskatchewan, and to a lesser degree Manitoba, we transport almost everything on long stretches of rail and roadway, predominately from the East. A national carbon tax, in this way, is a massive transfer from Western provinces to Ontario and Quebec where most of those goods originate.
British Columbia is self-sufficient in this regard, as they can import everything they need through low cost maritime transport. Carbon tax revenues transporting goods from the West Coast into interior B.C. “stay in the province.” However, the increased cost of bringing in Eastern manufactured goods, bid up from the added carbon tax of traversing 4-5 provinces, makes it such that there is practically no reason to import anything from the rest of Canada.
Odds are, China, with absolutely no environmental oversight, could manufacture and export into B.C. anything Ontario or Quebec can, cheaper.
If not the Chinese, the Americans could do the same.
Regardless, the Trudeau Carbon Tax is as Saskatchewan Premiere, Brad Wall puts it, “a betrayal” by the Federal Government. It is a wealth transfer that punishes the provinces that have no alternative but using carbon intensive methods of transportation for the basics of life.
It will economically isolate British Columbia from the rest of Canada.
It will punish Manitoba, Saskatchewan, but especially Alberta.
Geopolitical analyst, Peter Zeihan made a bold claim that “on plans already is for tax increase on young people, on consumption, on energy, that will in essence transfer a third if not more of the economy of Alberta to service retirement costs in Quebec and Ontario.”
That claim seems to perfectly describe the new Federal Carbon Tax.
The solution is clear: end the Carbon Tax by supporting separatist movements in your home province.