Alberta Calls for Repeal of Federal Carbon Tax

People pump gas at a gas station in Toronto on June 15, 2021. Tijana Martin/The Canadian Press

As the federal carbon tax rises—costing Albertans more than others, according to a recent government report—Alberta’s finance minister says the government should “eliminate the tax all together.”

“We urge the federal government to take the affordability crisis seriously and to immediately cancel the increase to the federal carbon tax, or better yet, eliminate the tax all together,” said Minister of Finance Travis Toews in a statement released April 1, the day the carbon price on fuel rose 30 percent.

With high inflation, the extra cost of fuel will exacerbate affordability problems, Toews said. It will make the cost of electricity, heating, and groceries more expensive, he said. “Elimination of the carbon tax and pausing federal fuel taxes, would help millions of Canadians cope with rising costs.”

While the federal government also offers rebates, called Climate Action Incentive payments, most Canadians will face a net loss.

“Based on our analysis, most households will pay more in fuel charges and GST—as well as receiving slightly lower incomes—than they will receive in Climate Action Incentive payments,” said Canada’s parliamentary budget officer, Yves Giroux, in a release on March 30.

Giroux’s office released a report on March 30 looking at the planned rise in carbon pricing from $65 per tonne this year to $170 per tonne by 2030. The net cost of the carbon tax will hit Alberta’s average households harder than those in other provinces.

The average Albertan household will pay $2,773 by 2030, according to the report. Ontario households will pay $1,820. The lowest cost will be to households in Newfoundland and Labrador, at $1,316.

The rebates are meant to give relief to Canadians with the lowest income and have the tax paid most heavily by the wealthiest, the government has said.

“If you do the average, yeah, it’s true, it’s going to cost more money to people, but the people who are paying are the richest among us, which is exactly how the system was designed,” Canada’s environment minister, Steven Guilbeault, said in an interview with CTV’s Question Period, which aired on April 2.

The rebates are meant to  help the people most in need in Canada, he said, and “that’s exactly what the system is doing.”

The federal government’s website gives the reason for imposing carbon tax, saying it will drive down emissions and drive innovation. “Carbon pricing is about recognizing the cost of pollution and accounting for those costs in daily decisions.”

Marnie Cathcart and Isaac Teo contributed to this report.