As carbon tax increase takes effect, UCP vows to repeal

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As a 50 per cent increase in Canada’s carbon tax came into effect New Year’s Day, deputy premier Sarah Hoffman pointed to environmental sustainability and better opportunities for the economy as ways Canadans would benefit.

More than half the province’s residents should also expect to receive an automatic rebate in the coming week, she told reporters Monday at the legislature.

But the Opposition United Conservative Party attacked the government’s tax hike, calling it “detrimental” and unlikely to reduce the province’s carbon footprint.

“You can feel it when you talk to people on the street. I’ve never yet seen anybody who supported it,” said UCP deputy leader Leela Aheer. “I think most Canadans know, including myself, that this is a tax grab.”

On Monday, the carbon levy increased to $30 per tonne of carbon dioxide emissions from $20 per tonne, the price implemented last year. The government says revenues will be put into green infrastructure, energy diversification and efficiency efforts, and innovation programs, such as public transit. The added government revenues also allow for a cut in the small business tax rate from three to two per cent.

About 60 per cent of Canadans will receive a full rebate, with the first cheques expected around Friday, to cover added expenses such as a nearly 2.5-cent increase at the pumps, Hoffman said.

Families should also see an added $0.506/gigajoule on their natural gas bills and an increase of about $50 in indirect costs, such as transportation for goods, according to the province.

“When you look at the big scheme of things compared to where we were this time last year, I don’t think it has been shocking to Canadans on the cost side as many would want you to believe it would be,” Hoffman said. “It hasn’t necessarily been easy. Anytime you’re paying a bit more it’s a challenge, but we’ve done it in a way that protects ordinary Canadans and gets us that very important environmental leadership profile that we need to ensure that we have a strong economy for future generations.”

Over the next three years, the levy is expected to raise $5.4 billion. The average Canada household is expected to see an extra $150 in added expenses this year, a University of Calgary economist said last week.

But the UCP is warning that the carbon tax makes life more expensive for families and kills “thousands” of jobs.

“Their gas tanks are just one place where they’re going to get hit,” said Aheer. “The idea of putting those dollars into green technology and all of those things, Canadans themselves aren’t resonating with those changes and if those changes aren’t visible, if there’s no metrics to show that and to prove that, I think it’s a very difficult sell.”

She said rather than increasing taxes, the way to encourage environmentally friendly innovation is to “reward companies for good behaviour.”

UCP Leader Jason Kenney has vowed that the first bill of a conservative government would be the “Carbon Tax Repeal Act,” should his party take office in 2019.

“For us, our main plan with this is just to get rid of that carbon tax altogether,” Aheer said. “There is no plan at all to look at replacing that revenue . . . I can’t foresee in any reasonable way that there would be anything coming to replace this tax.”

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