EDITORIAL: Applauding carbon tax rebates

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The good news is that Prime Minister Justin Trudeau’s government is about to start sending “climate action incentive payments” directly to households in the four provinces where it has imposed its carbon tax.

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They will start arriving shortly after July 15 and quarterly thereafter.

The first payment for people living in Ontario, Alberta, Saskatchewan and Manitoba who have filed their tax returns will be double the normal amount to cover the period from January 1 to June 30, 2022.

After that, checks will be sent quarterly beginning October 15, 2022, followed by January 15, 2023, followed by quarterly payments annually beginning April 15, July 15, October 15, and January 15 through 2030.

Payments are not based on the carbon footprint of individuals or families, but on household size and the amount of carbon tax revenue generated in the province where they live, with an additional 10% for those in small rural communities.

The government says paying the Climate Action Incentive for the average Ontario household will result in a net gain of $134 in 2022 over the estimated amount it will pay in carbon taxes; a net gain of $338 in Alberta; $319 in Saskatchewan and $229 in Manitoba.

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The government says 80% of households in the four provinces will receive more in rebates than they pay in carbon taxes.

But according to independent, nonpartisan Parliamentary Budget Officer Yves Giroux, when the economic inefficiencies caused by the carbon tax are factored in, a very different picture emerges.

Because of this, says Giroux, the average household in Ontario will be worse off in 2022 by $360; $671 in Alberta; $390 in Saskatchewan and $299 in Manitoba.

PBO also estimates that 60% of households in the four provinces will receive less in rebates this year than they will pay in carbon taxes.

When Trudeau’s carbon tax, now $50 per tonne of greenhouse gas emissions, hits $170 per tonne in 2030, Giroux estimates the average Ontario household will be $1,461 worse off; in Alberta, $2,282 worse off; in Saskatchewan, $1,464 worse and in Manitoba $1,145 worse.

Giroux did not estimate the potential savings from tackling climate change compared to inaction, but noted that it would be “extremely optimistic” to believe savings will materialize by 2030.


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