“Starting next year, it will no longer be free to pollute anywhere in Canada. And we’re also going to help Canadians adjust to this new reality. … Every nickel will be invested in Canadians in the province or territory where it was raised.”
With those words, Prime Minister Justin Trudeau laid down the gauntlet on climate change. At an event at Humber College — a school in Ontario Premier Doug Ford’s home riding of Etobicoke — Trudeau rolled out his plan for a carbon tax in provinces that had refused to implement one: New Brunswick, Ontario, Manitoba and Saskatchewan.
It was his version of his father’s famous “Just watch me,” imposing the heavy hand of Ottawa to bend the provinces to his will.
READ MORE: Liberals say 90% of carbon tax will be given to Canadians in rebate
But it came with a sweetener. One year to the federal election, the PM is betting that a cheque in the mail will dull the pain at the pump. Starting in April 2019, Ottawa will send out rebate payments ranging from $248 a year for a family of four in New Brunswick to $598 per year in Saskatchewan. According to the government, 70 per cent of Canadian households will get more money back than they pay in carbon taxes.
The premiers would have none of it. Saskatchewan Premier Scott Moe decried the payment program as a “shell game” and a “cynical vote-buying scheme.” Ontario Premier Doug Ford thundered, “Justin Trudeau wants to make it personal, going to my backyard to make the tax.”
On the federal side, Conservative leader Andrew Scheer chimed in, “Canadians are now supposed to take his word that a measly $12.50 a month will cover the true cost of his carbon tax. … It will make everything more expensive for the people who can afford it the least.”
WATCH BELOW: Liberal government unveils carbon tax
And prices will go up. According to government documents, for every $20 per tonne in carbon tax, gasoline prices will grow by an estimated 4.42 cents a litre. Prices of other fuels will increase as well: 3.91 cents per cubic metre for natural gas, and 3.10 cents per litre for propane. These hikes won’t show up as separate charges on consumers’ bills, but will be passed down by fuel and distribution companies. This makes them impossible to monitor, as the consumer is not in the position to ensure that companies aren’t tacking on additional increases over and above the amount of tax.
From a political standpoint, however, this structure deflects consumers’ ire from the government to the energy industry: unlike a visible tax, consumers won’t be constantly reminded that their money is really going to the government. Meanwhile, Ottawa will take credit for sending them a rebate — or so the Liberals’ logic goes — timed to hit a few short months before the next federal election.
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WATCH BELOW: Is Trudeau’s carbon tax plan a gimmick?
If this strategy sounds familiar, it should, because it is the same one the federal Conservatives tried back in 2014 to sell another controversial policy: income splitting. When the Tories overhauled the tax system to allow spouses to split income, they stood accused of favouring the rich and married, while leaving the poor and single parents out in the cold.
To mitigate criticism, they announced an increase in the child care expense deduction and in monthly payments of the Universal Child Care benefit. Cheques totalling hundreds of dollars rolled out the summer before the 2015 election, just like the Liberals are proposing to do with the carbon tax.
The road to re-election, however, was not paved with voters’ own money. Harper lost and the Liberals jettisoned income splitting not long after. And while that policy may not have been an easy sell, carbon taxes are no slam dunk either. Only 45 per cent of Canadians support them, down from 56 per cent two years ago, according to the Angus Reid Institute. There is also a substantial subset of Canadians who do not accept that climate change is real and man-made. One in five believe it is real but caused by natural processes, 14 per cent say it’s not real, and 11 per cent are uncertain.
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While the latter groups are not likely to vote for Trudeau in any event, they will now be more motivated than ever to get out to the polls to vote for his rivals. And that could be a problem. An Ipsos poll has the Tories neck and neck with the Liberals a year out from election day.
READ MORE: A year away from election day and no-name Scheer is right behind celebrity Trudeau, Ipsos poll
An Angus Reid poll shows Trudeau to be vulnerable on key issues such as the deficit, with the Conservatives having the most room to grow. A Forum poll even put the Tories in “majority territory” should an election have been held last week.
Apart from the political capital at stake, the real question is whether Trudeau’s policy will actually achieve its goal of cutting emissions. “The science is unequivocal: putting a price on pollution is one of the best ways to move forward,” the PM said.
But will consumers really modify their behaviour in function of this tax? Many residents of rural areas have no other choice but to use gasoline-powered vehicles: will they drive less? Will natural gas customers turn down their thermostats as their bill rises? Will millions of Canadians ditch their propane-fueled barbeques, take shorter showers, and switch to electric cars?
What climate action incentive payments are, how they work and who they will affect
Maybe, maybe not. That’s likely why the government is including a “part two” of the bill — a separate fuel charge for large industry, called the output-based pricing system. That tax will not be returned to Canadians in the form of a rebate, but used to support “future climate actions” in the provinces where the money is raised.
Trudeau is acting to fulfil his election promise and please his environmental constituency, who have not forgiven him for buying the Trans Mountain pipeline. But with 47 per cent of Canadians now living under a federal carbon tax regime, it’s not clear that this trade off will pay off at the ballot box. The last attempt at a Green Shift, in 2008, failed miserably, but those were different times, and the Liberals had a different leader. Whatever the outcome in 2019, it’s clear that the next election is shaping up to be a battle for green — in voters’ hearts, minds, and wallets.
Tasha Kheiriddin can be heard between noon and 2 p.m. ET on Global News Radio 640 Toronto. She’s also a columnist with Global News and iPolitics.ca, where this piece first appeared.
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