Global InformationCarbon pricing in Canada information
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Carbon pricing in Canada is implemented either as a regulatory fee or tax levied on the carbon content of fuels at the Canadian provincial, territorial or federal level. Provinces and territories of Canada are allowed to create their own system of carbon pricing as long as they comply with the minimum requirements set by the federal government; individual provinces and territories thus may have a higher tax than the federally mandated one but not a lower one. Currently, all provinces and territories are subject to a carbon pricing mechanism, either by an in-province program or by one of two federal programs.[1] As of April 2023[update] the federal minimum tax is set at CA$65 per tonne of CO2 equivalent, set to increase to CA$170 in 2030.[2][3]
In the absence of a provincial system, or in provinces and territories whose carbon pricing system does not meet federal requirements, a regulatory fee is implemented by the federal Greenhouse Gas Pollution Pricing Act (GHGPPA), which passed in December 2018. In provinces where the fee is levied, 90% of the revenues are returned to tax-payers.[4]
The carbon tax is levied because of a need to combat climate change, which resulted in Federal commitments to the Paris Agreement. According to NASA's Jet Propulsion Laboratory (JPL), the air today contains 400 ppm of CO2 while the CO2 level average over the past 400,000 years was between 200 ppm and 280 ppm.[5][6]
Saskatchewan never had a carbon pricing system and other provinces—Manitoba, Ontario, New Brunswick, and Alberta—have opted out of previous provincial carbon tax systems. Revenue from the federal GHGPPA, which came into effect in April 2019, is redistributed to the provinces, either through tax credits to individual residents or to businesses and organizations that are affected by the tax but are unable to pass on the cost by raising consumer prices.[7][4]
The introduction of the tax was met with political resistance, mainly by the Conservative Party of Canada which attempted to "make the carbon tax the single issue" of the 2019 federal election campaign.[8] This argument did not succeed, as the Canadian voting public supported parties that also supported the carbon tax, leading CBC News to declare Canada's carbon tax to be "the big election winner" and "the only landslide victor" in this election.[9] Similarly, legal challenges to the law failed on March 25, 2021 when the Supreme Court of Canada rejected the 2019 appeal of the provinces of Manitoba, Ontario, Alberta, and Saskatchewan, ruling in Reference re Greenhouse Gas Pollution Pricing Act that GHGPPA was constitutional.[10]
- ^ Urban, Rylan (September 24, 2020). "Carbon Tax and Rebate in Canada 2024". energyhub.org. Retrieved September 26, 2020.
- ^ Canada, Department of Finance (October 23, 2018). "Backgrounder: Fuel Charge Rates in Listed Provinces and Territories". www.canada.ca.
- ^ Canada, Environment and Climate Change (August 5, 2021). "Update to the Pan-Canadian Approach to Carbon Pollution Pricing 2023-2030". www.canada.ca.
- ^ a b Nuccitelli, Dana (October 26, 2018). "Canada passed a carbon tax that will give most Canadians more money". The Guardian. Archived from the original on November 29, 2018. Retrieved January 1, 2019.
- ^ Callery, Susan, ed. (nd). "Graphic: The relentless rise of carbon dioxide". Earth Science Communications Team. NASA's Jet Propulsion Laboratory, California Institute of Technology. Climate Change: Vital Signs of the Planet. Retrieved October 27, 2019.
- ^ "Innovation Energy: Canada leads the way in carbon capture as more governments put a price on CO2". Financial Post, a division of Postmedia Network Inc. July 17, 2019.
- ^ Greenhouse Gas Pollution Pricing Act (SC 2018, c 12, s 186). CANLII. June 21, 2018. Retrieved December 19, 2018.
- ^ Cite error: The named reference
NaPo_Ivison_20180618was invoked but never defined (see the help page). - ^ Bakx, Kyle (October 22, 2019). "The big election winner? The carbon tax". CBC News. Retrieved November 17, 2019.
- ^ Cite error: The named reference
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