Premiers Call for More Exemptions From Federal Carbon Tax

(Left) United Conservative Party Leader Danielle Smith makes her victory speech in Calgary, Alta., on May 29, 2023. (Jeff McIntosh/The Canadian Press); (Right) Saskatchewan Party Leader Scott Moe speaks during the leaders' debate at the Provincial Archives in Regina on Oct. 14, 2020. Michael Bell/The Canadian Press

Several premiers are calling for more exemptions from the carbon tax, saying the decision by Prime Minister Justin Trudeau to halt the tax on heating oil does not address affordability issues plaguing their provinces.

On Oct. 26, Mr. Trudeau announced that heating oil would be exempted from the federal fuel charge for three years, starting Nov. 9, in all jurisdictions where it is in effect. While the Liberals estimate that the pause will save an average household that uses heating oil $250, the prime minister made it clear that his government will work with provinces to phase out home heating oil and switch to electric heat pumps eventually.

Mr. Trudeau’s move was criticized by several provinces. The premiers said by leaving out other heating options, such as natural gas, the change seems to favour households in Atlantic Canada, which primarily rely on heating oil to heat their homes.

“Although I congratulate Atlantic Canadians for a well deserved break from the carbon tax on home heating oil, I am frankly disturbed that same break will not be extended to Albertans and those from Saskatchewan and elsewhere in Canada who heat their homes with natural gas,” said Alberta Premier Danielle Smith in a post on X on Oct. 26, following Mr. Trudeau’s announcement.

‘An Admission’

Saskatchewan Premier Scott Moe says the policy change by the Trudeau government is “an admission” that the federal carbon tax is “making life a lot less affordable.” Mr. Moe added that the exemption on heating oil will not do much for his province.

“The carbon tax is still being fully applied to natural gas and over 90% of Saskatchewan households are heated with natural gas,” he said on X on Oct. 26. “Just axe the tax on everyone and everything.”

According to data from Statistics Canada, oil made up only a small proportion of the “primary heating system and type of energy” in most provinces except those on the East Coast.

Data released by the federal agency last December indicated that in 2021, oil as the main heating fuel constituted 4 percent in Quebec, and 2 percent in Ontario. B.C.’s share was reported at 1 percent but the agency warned to “use [the data] with caution.” Figures for Alberta, Saskatchewan, and Manitoba were deemed “too unreliable to be published.”

Meanwhile, the Atlantic provinces were the biggest users, with Prince Edward Island having 40 percent of its heating fuel coming from oil. Nova Scotia came second at 32 percent, while Newfoundland and Labrador and New Brunswick trailed behind at 18 percent and 7 percent, respectively.

Mr. Moe questioned how the exemption could help Saskatchewan residents cope with affordability. He shared the same data from Statistics Canada on X on Oct. 27. “Let’s see how much that’s going to help Saskatchewan households,” he said.

‘Eliminate the Tax’

Ontario Premier Doug Ford echoed the sentiment of Ms. Smith and Mr. Moe. He said while it was a step “in the right direction” by the federal government, the vast majority of people in his province heat their homes and businesses with natural gas and would still have to pay the carbon tax.

In a similar vein, he called on Mr. Trudeau to cancel the carbon tax program.

“The carbon tax is making life more expensive for everyone in every part of the country,” said Mr. Ford on X on Oct. 26. “I’m urging the prime minister to do what’s right and eliminate the tax altogether.”

Ottawa also drew criticism from Alberta’s opposition NDP. “To apply a carbon price to only some regions and some fuels is totally unacceptable,” NDP Leader Rachel Notley said in a statement on Oct. 27.

Provinces that likely benefit more from the Liberals’ latest policy change expressed their views as well following the prime minister’s announcement.

New Brunswick Premier Blaine Higgs said on Oct. 27 that although the three-year-pause is “directionally right,” he wanted it to serve as “an opportunity to fix all the flawed Liberal energy policies that are making life more expensive for everyone.”

Tim Houston, premier of Nova Scotia, said he welcomed the change, but stressed that “it is a small step” at addressing cost of living challenges facing his residents impacted by the carbon tax.

“I appreciate this step and will continue to fight for the carbon tax to be removed entirely,” said Mr. Houston on X on Oct. 26.

The premier of Newfoundland and Labrador said he was pleased to see some changes to “help lighten the burden” in his province.

“The federal government has finally made some of the necessary changes,” Premier Andrew Furey said in a statement posted on X on Oct. 26.

‘One More Time’

The Epoch Times reached out to the Prime Minister’s Office but did not hear back by publication time. Requests for comment from the premiers of B.C., Manitoba, Quebec, and P.E.I. were also unanswered by press time.

During his announcement on Oct. 26, Mr. Trudeau said his government would also double the rural top-up rate from 10 percent to 20 percent in the carbon-price rebate for households.

The federal carbon tax, which applies to provinces and territories without their own carbon pricing systems, is currently priced at $65 per tonne of emissions and will increase by $15 every year until 2030. Households in the provinces receive carbon rebates to offset the costs they incur.

Conservative Leader Pierre Poilievre, who has long called for Ottawa to “axe the carbon tax,” said Mr. Trudeau’s move was a “scam designed to trick oil-heating households into voting for him one more time so he can hit them with his big tax hike.”

A recent Ipsos poll showed the Liberals trailing behind the Conservatives in popularity, with the Tories maintaining the support of 35 percent of Canadians, versus the Liberals’ 30 percent.

Matthew Horwood contributed to this report.