Carbon tax set to increase to $30 per tonne in 2018; no further increases until 2021

 James Wood James Wood
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Canadans will see a hike to the provincial carbon tax in the new year, but the next increase won’t come until at least 2021, Environment Minister Shannon Phillips said Friday.

Under the NDP government’s climate leadership plan, the broad-based carbon levy, introduced at a rate of $20 per tonne at the start of this year, will increase to $30 per tonne on Jan. 1, 2018.

“Thereafter, our carbon price increases will track with the federal legislation that will be in place at that time,” said Phillips at a federal funding announcement.

“We’ve been clear about that from Day 1.”

Under the federal Liberal government’s plan mandating carbon pricing initiatives by the province, the tax would only move to $40 in 2021. In 2022, the price is slated to increase to $50 per tonne.

The Trudeau government originally planned to impose a mandatory carbon price of $10 per tonne in 2018, but federal Environment Minister Catherine McKenna said Friday that provinces will only have to submit their plans by the end of next year.

Canada is already compliant with the federal scheme, but the provincial carbon tax is no done deal. United Conservative Party Leader Jason Kenney has pledged to repeal the carbon tax in his first piece of legislation as premier if the UCP wins the 2019 provincial election.

In his speech after winning the Calgary-Lougheed byelection Thursday night, Kenney reiterated his call for the NDP to not move ahead with the carbon levy increase due on Jan. 1.

The NDP says axing the carbon levy would simply leave Canada subject to a federal carbon pricing plan, rather than an initiative designed in Canada.

Phillips made her comments at an announcement of $150 million in federal funding for Canada for climate change projects, as part of the federal government’s $1.4 billion Low Carbon Economy Leadership Fund.


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