It wasn’t an April Fool’s joke – the carbon tax went up by 30% on April 1.
That means everything is about to get more expensive. Last year, Bank of Canada Governor Tiff Macklem told a federal committee the federal carbon tax increased inflation by 0.4%. That was at the $50 per tonne. That means, using a direct calculation, that at $65 per tonne, the impact to inflation will now be .52%.
That is a quarter of the total the Bank of Canada tries to limit inflation to. Simply stated, the carbon tax makes the cost of living go up and right now, people can’t afford an increase to the cost of living.
Recent polls have shown 44% of British Columbians are $200 away from insolvency. With carbon tax increasing, that $200 will soon be gone.
The carbon tax was originally brought in by the BC Liberals in 2008 as a revenue neutral tax that was used to lower emissions and was given back to British Columbians. That is no longer the case.
The current NDP government in B.C. will collect $2.811 billion in carbon tax revenue this year and is planning to spend $757 million of that through the Climate Action Tax Credit. What will the remaining $2.054 billion be spent on?
I would love to see it spent on those who are most impacted by the carbon tax.
The recent provincial budget states: “Single-income female-led households have a higher carbon tax burden than single-income male-led households. Research suggests that BC's carbon tax has no significant difference in direct carbon tax paid by rural versus urban households. However, rural communities may have higher indirect carbon tax burdens (e.g. through higher shipping costs resulting in a higher price of goods), and colder regions of the province may have higher carbon tax costs for home heating.”
But when I asked Environment Minister George Heyman during the ministry's estimates what the $2.054 billion would be spent on, he said transit and active transportation corridors. But if the carbon tax disproportionately affects those that do not have access to those alternative forms of transportation, how does this help them?
So not only does everyone outside of the Metro Vancouver area pay more carbon tax – they also are not getting the benefit of it.
The Minister of Environment and Climate Change Strategy argued last week in budget estimates the “made in B.C.” carbon tax is better than the federal carbon tax. But that does not seem to be the case.
B.C. residents pay double the net carbon and fuel tax compared to the next highest province, while other provinces return rebates to their residents in excess of what they pay in carbon tax.
I contend the government's approach is flawed and believe the tax hike will disproportionately burden those who can least afford it, stifling economic growth and exacerbating inequality in the province.
The carbon tax is a regressive tax, with low-income families and individuals typically spending a higher percentage of their income on essentials, such as food, heating, and transportation. As the carbon tax is embedded in the cost of goods and services, these individuals will be hit hardest by the tax increase.
What was once a revenue neutral tax is now contributing almost 5% to the overall revenue of B.C., all the while affecting those who are least able to afford it the most.
So does this regressive tax/revenue generator help to lower B.C.’s emissions? The short answer is no. BC has only had a decrease in emissions for one year out of six under the current government - in 2020 - during which the COVID measures helped to lower our emissions by 4%, while the rest of Canada lowered theirs by 9%. We went down by less than half the rest of the country.
Our emissions aren’t going down, our carbon tax is skyrocketing, our cost of living is rising and the government is using the carbon tax as cash cow.
Something has to give.
My question to you this week is this:
Do you think you are benefitting from carbon tax?
I love hearing from you. Please email me at [email protected] or call my office at 250-712-3620.
Renee Merrifield is the B.C. Liberal MLA for Kelowna-Mission.
This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.