Saskatchewan files constitutional reference case over carbon tax

The Saskatchewan government has made it no secret they intended to take the federal government to court over the proposed carbon tax. After 18 months of opposition, Saskatchewan announced the launch of its constitutional reference case April 25.

Filed in the Saskatchewan Court of Appeal, the province is asking the court to answer the following question on the constitutionality of the federal government’s carbon tax legislation:

The Greenhouse Gas Pollution Pricing Act was introduced into Parliament on March 28, 2018 as Part 5 of Bill C-74.  If enacted, will this Act be unconstitutional in whole or in part?

Tweet This Click to share quote on Twitter: <em>The Greenhouse Gas Pollution Pricing Act </em>was introduced into Parliament on March 28, 2018 as Part 5 of Bill C-74.  If enacted, will this Act be unconstitutional in whole or in part?

Saskatchewan Justice Minister and Attorney General Don Morgan said the province’s constitutional lawyers believe Saskatchewan has a winning chance in court. They believe The Greenhouse Gas Pollution Pricing Act goes against the constitution because it imposes a tax on some jurisdictions and not others based on what each province has chosen to do in its own jurisdiction.

“This runs contrary to the principle of federalism, which is one of the bedrocks of our constitutional division of powers, because it fails to respect the sovereignty and autonomy of the provinces with respect to matters under their jurisdiction,” Morgan said in a statement.

“Simply put, we do not believe the federal government has the right to impose a tax on one province but not others just because they don’t like our climate change plan.”

The province put forward the argument that under the constitution, each level of government is sovereign within its own legislative realm meaning the federal government can’t override provincial authority in areas where provincial government has jurisdiction.

During a Wednesday news conference announcing this measure, Premier Scott Moe said that Saskatchewan recognizes the federal government’s ability to add a new tax when all jurisdictions are treated equally, such as GST. Moe argued that not all jurisdictions are being treated equally in this plan, as Saskatchewan did not sign onto the Pan-Canadian Framework on Climate Change that acknowledges a carbon price as an important component in addressing climate change.

When asked about uniformity being built into the federal plan, a baseline carbon price of $10/tonne initially and growing to $50/tonne in 2022, Moe provided the following analogy.

“Let’s say that the federal government wanted to equalize the consumption tax across the nation, so they would impose a five per cent GST increase in the province of Alberta where they do not have a consumption tax,” Moe said. “That would be a similar argument that would be put forward in that case under the constitution.”

Opposition Leader Ryan Meili does not have the same confidence in the argument as his in government counterparts.

“I saw the word believe in there quite a lot. It seems like this is something going on blind faith without a whole lot of evidence that there really is a case from a constitutional point of view that they will win,” Meili said.

Meili added that he views this as an expensive and risky endeavour.

“Risky in the fact that because they don’t have a plan b, because they’re not also coming up with a made in Saskatchewan solution at the same time as they explore this we’re very likely, by the end of this year, a plan that’s designed by Trudeau and the Liberals in Ottawa rather than something that’s designed with the best interest of Saskatchewan people,” Meili said.

Federal Natural Resource Minister Jim Carr said that Ottawa has not yet thought through whether or not they will intervene in Saskatchewan’s legal case.

“I think that other provinces have done that too, they’re free to use the courts to make a case. We believe this is in our constitutional jurisdiction, just as we know that approving the Kinder Morgan Pipeline would be,” Carr said.

The province says their strategy, Prairie Resilience, goes farther than the federal framework and will do more to reduce emissions.

This strategy includes the development of “sector-specific output-based performance standards,” which would allow large carbon emitting facilities to be able to make up for their emissions by purchasing carbon offsets or paying into a technology fund.

Most of the industry targets in Prairie Resilience are still being developed.

Duncan has said consultation is still ongoing, and further announcements will be made later this year. The plan is to have Prairie Resilience in place for January 1, 2019.