Federal Carbon Tax To Increase $15 Per Tonne Each Year After 2022
OTTAWA – The federal government announced a new, bolder, climate action plan Friday that will see polluters pay more, starting in two years.
Beginning in 2023, carbon pricing will increase by $15 per tonne every year until 2030. The money earned will be used to give Canadian households quarterly rebate payments. The announcement was made during a press conference with Prime Minister Trudeau and several Ministers on December 11.
The price of gas at the pumps will increase by more than 35 cents a litre by 2030, as well, due to the higher taxes.
“It should not be free to pollute in this country,” said Jonathan Wilkinson, minister of environment and climate change. “The carbon-pricing system that rises over the long term provides clear market signals that encourage business, investors, and individuals to make smart, low carbon, choices.”
This pricing strategy will affect the provinces that don’t have their own approved carbon pricing program. Nova Scotia has a cap-and-trade system, and New Brunswick just introduced a much-criticized tax this year.
The new carbon pricing scheme is a part of the Liberals’ new $15-billion climate change plan. This new money is on top of the $60-billion that was already announced for the pan-Canadian framework.
“The clean growth economy is not some utopian idea of something that might happen far-off into the future, it is a rapidly-accelerating reality,” said Wilkinson.
“We should all be allies in the fight against climate change because climate knows no boundaries. But we are competitors in the race to seize the economic opportunities provided by this drive to reduce emissions.”
Wilkinson made a bold prediction that the Liberals’ plan will allow Canada to beat its Paris accord targets 10 years from now.
“With this plan, Canadians will exceed our 2030 greenhouse gas emissions reduction target under the Paris agreement.”
“We will achieve the building blocks to achieve net-zero by 2050.”
The new plan also aims at rewarding Canadians who lower their carbon footprint. In Friday’s announcement, it says $2.6-billion will be spent over seven years so people can make their homes more energy-efficient. The money will be available in grants worth up to $5,000.
The government will also be providing $2-billion for commercial and large-scale building retrofits. An additional $1.5-billion will be used for “green and inclusive” community buildings; 10 percent of this funding will go to Indigenous groups.
The government plans to incentivize citizens to convert to energy-efficient vehicles. Up until March of 2022, this program will provide rebates of up to $5,000 on a “light duty zero-emission” vehicle. The press release also states the feds will provide more money for public transportation.
There is even more incentive for commercial vehicle owners to switch to electric. The Liberals promise to give a “100-percent tax write off for commercial light-duty, medium- and heavy-duty ZEVs (zero emmison vehicles).”
The Liberals also readdressed their promise to plant two billion trees across Canada. The province will spend $3.16-billion over 10 years to partner with provinces and Indigenous governments to achieve this goal.
The Liberals are framing these measures as an economic plan, as much as it is an environmental one. Many people fear a switch to a green economy will create massive job losses. Minister of Canadian Heritage, Steven Guilbeault, said this plan will create two million jobs, but he didn’t specify how.
“Climate Change is the biggest threat to our health and for our economy, but they also represent enormous opportunity. The plan we’re announcing today will allow us to create two million sustainable jobs in the future.”