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B.C. takes lead on climate file
Editorial, The Star
Everybody talks about global warming, but the government of British Columbia is the first jurisdiction in Canada to take a significant step toward doing something about it. In Tuesday’s provincial budget, Premier Gordon Campbell’s Liberal government introduced the first full-fledged carbon tax in North America, thereby putting a real price on the greenhouse gas emissions that come from burning fossil fuels.
Highlighting the degree of disarray in this country over global warming, B.C.’s new carbon tax comes only weeks after Premier Ed Stelmach of neighbouring Alberta (source of almost one-third of Canada’s greenhouse gas emissions) walked out of a premiers’ meeting convened to discuss climate change.
The blame for the incoherent muddle of provincial policies on the most pressing problem facing the planet rests ultimately with Prime Minister Stephen Harper’s government, which has yet to take any concrete action or demonstrate real leadership on the issue.
Frustrated by that vacuum at the centre, B.C. decided to strike out on its own. As Finance Minister Carole Taylor put it in her budget speech, “It’s our decision that we must start now to take action if we’re to accomplish our goal” (to cut emissions by one-third within 12 years).
Her plan has much to recommend it. Phased in over five years to give consumers and businesses alike time to adjust, the tax starts off at $10 per tonne of carbon-equivalent emissions, and rises by $5 per year for the next four years. For drivers, that amounts to an extra 2.4 cents per litre of gasoline, rising to 7.2 cents by 2012.
For those who learn to conserve and use fuels more efficiently, however, the cost will not be nearly as large as it might first appear because the government has committed to return all the revenue collected through the carbon tax to taxpayers in the form of personal and corporate income tax cuts. And to protect low-income British Columbians who might not benefit from income tax cuts, Taylor has also introduced an annual credit of $100 per adult and $30 per child.
… But rather than a checkerboard approach to global warming with each province adopting its own measures, it would be preferable if the federal government produced a national policy. Better still if the United States, Canada and Mexico could agree on a continental policy.
(21 February 2008)
B.C. Liberals finesse the politics of climate change, but now have to tackle the economics
Editorial, Vancouver Sun
The groundbreaking carbon tax announced in the B.C. budget this week will pale in significance to the changes needed over the next few years to meet Premier Gordon Campbell’s ambitious targets for fighting climate change.
But before we move on to the difficult decisions ahead, let’s recognize just how significant a political breakthrough the provincial government has achieved.
Most politicians in Canada have shunned the idea of carbon levies because of the stigma attached to any new tax. The federal government characterizes them as an evil tax grab, as have other provincial premiers. Even Liberal leader Stephane Dion, so committed to fighting climate change that he named his dog Kyoto, has promised not to add carbon taxes to his arsenal.
But the B.C. government has brought in the first significant set of carbon taxes in North America and is showing it could be done with remarkably little political resistance.
(21 February 2008)
Carbon tax focus of British Columbia budget
Justine Hunter, Globe & Mail
Campbell government introduces carrot-and-stock enviro-document in effort to curb greenhouse gases
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VICTORIA — The B.C. government introduced North America’s first full-fledged carbon tax yesterday, an attempt to engineer a social movement aimed at getting British Columbians to cut their greenhouse-gas emissions.
The new tax will be tempered with matching income-tax cuts plus what is likely the province’s largest-ever dividend to taxpayers.
“We promised you green and today we delivered green,” said Finance Minister Carole Taylor, who presented the changes as a way of encouraging environmentally friendly choices through a carrot-and-stick system. “If you start to change your lifestyle even modestly … you will have extra dollars in your pocket,” she said.
The $37.7-billion budget boosts program spending, increases the debt and forecasts the slowest economic growth for the province since 2001. The economy and debt were not top of mind for Ms. Taylor, who stuck to a green theme in everything from the budget cover to her outfit.
(20 February 2008)
Carbon tax called good start — but not enough
Fiona Anderson, Vancouver Sun
Fight against pollution must be a global effort, CIBC economist says
British Columbia’s carbon tax is a good start but the fight against emissions has to be global if it is to be successful, CIBC World Market’s chief economist Jeff Rubin said Wednesday.
“I think it’s a positive step, the move to a carbon tax. I think it signals intent,” Rubin said in an interview.
Rubin believes that “putting a price on carbon is probably the single most important thing a government can do right now.”
But he advocates a cap and trade system where the government sets environmental targets and the market determines the price.
“What I don’t like about carbon tax is somebody figures out it’s going to be $30 or $10, but they don’t know whether that’s going to have the intended economic consequences to ultimately achieve their environmental target,” he said.
“I like starting off with the environmental target first and then letting the market figure out whatever market-clearing price has to occur.”
Rubin says that other jurisdictions in North America will soon have environmental legislation as well. And once the United States introduces carbon emissions measures — which he expects will happen under the next presidency regardless of who wins — the federal government in Canada will likely follow.
(22 February 2008)
Laudable green initiatives come at expense of social needs
Marc Lee, Vancouver Sun
… A major concern with carbon taxes is their impact on low-income families. The budget addresses this by recycling some of the carbon tax revenues into a low-income tax credit. This will piggyback on the GST credit, and is worth a maximum of $100 for adults and $30 for children.
This seems reasonable for the first couple of years, and may make many low-income families better off. But the tax credit is indexed to inflation, not to increases in the carbon tax. That tax is set to triple by July 2012 to $30 per tonne, but the tax credit will only increase by about six per cent. A few years down the road, we may have a system that punishes those who have contributed the least to climate change.
Marc Lee is a senior economist in the B.C. Office of the Canadian Centre for Policy Alternatives.
(21 February 2008)
Carbon tax to cover all B.C. fuels
Tom Fletcher, BC Local News
… NDP finance critic Bruce Ralston said the budget exempts major industries from the carbon tax, at least until a carbon trading system comes into place. He also noted that the biggest business tax cut is for financial institutions.
“It’s a great day for banks and big polluters,” Ralston said. “They figured out in 13 months how to make ordinary people pay a carbon tax. There are a few one-time benefits, but the real beneficiaries here are the big banks.”
The government is also sweetening the carbon tax deal with a one-time-only “climate action dividend” of $100, to be sent out in June. People are encouraged to spend it on something that helps reduce greenhouse gas emissions, but there are no strings attached.
The carbon tax is based on $10 per tonne of carbon emissions, rising by $5 a year to $30 in 2012.
NDP environment critic Shane Simpson questioned whether 2.4 cents per litre on the price of gasoline will be enough to change people’s driving habits. He also noted the government is increasing financial incentives to oil and gas exploration.
The budget also includes $1 billion in government spending on climate change efforts. These include $370 million for public transportation, $57 million for bioenergy and alternative energy such as solar power, $31 million for innovation and carbon storage in forests and related industry, and $49 million to prepare for global warming by improving river flow data and funding flood protection works.
(19 February 2008)
Suggested by Contributor Bryan Swansburg.
