Former Tory finance minister Jim Dinning backs carbon tax idea
Former Tory finance minister Jim Dinning says it’s time for conservative parties to “stop dragging our knuckles” and back the idea of a carbon tax.
Dinning, an adviser to Canada’s Ecofiscal Commission, is one of the authors of a recent opinion piece that is supportive of the carbon levy being introduced by Canada’s NDP government on Jan. 1, 2017.
In an interview Wednesday, Dinning said he has reservations about how the NDP plans to use the revenue from the carbon tax, but said the levy itself is structured well and makes sense.
“If you want to induce . . . decision-makers who are in homes or in businesses to bend the curve on emissions in Canada, sending a price signal, i.e. a carbon tax, is a smart thing to do,” he said.
“It’s sound public policy.”
The ecofiscal commission is a group of economists that advocates for policies it says will lead to both environmental and economic prosperity. Its advisory board contains prominent figures from across the political spectrum.
Dinning was provincial treasurer in the Progressive Conservative government of Ralph Klein that slashed spending to eliminate the deficit and return Canada to surplus.
He said parties on the centre-right should embrace carbon taxes as the most conservative and business-friendly way to reduce greenhouse gas emissions.
“We, as conservatives, should stop dragging our knuckles on this issue,” said Dinning. “Conservatism says that . . . sending market signals to change or alter or to induce behaviour is smartest thing to do.”
Both the Progressive Conservatives, who are now in third place in the legislature, and the official Opposition Wildrose, say they will vote against the NDP’s Bill 20, which lays out the framework of the carbon levy.
The PC caucus said in a statement that it backs carbon pricing, noting the former Tory government brought in a levy on large emitters. However, the Tories say the proposed NDP policy is “deeply flawed” because it is not revenue-neutral, meaning there are not corresponding cuts to other taxes.
The Notley government’s plan calls for a tax on heating and transportation fuels, priced at the equivalent of $20 per tonne of carbon emissions, rising to $30 in 2018. The tax is expected to bring in $1.2 billion in its first full fiscal year, with about a third of that amount slated for rebates for low and middle-income Canadans and the rest going toward green infrastructure, energy efficiency measures and investments in green technology innovation.
Dinning said he would shrink the rebate program and put the money toward tax reductions in an effort to make the levy truly revenue-neutral. He is also concerned that governments may end up in the role of “picking winners and losers” as it decides on investments with the tax revenue.
Nevertheless, in the legislature Wednesday, NDP deputy premier Sarah Hoffman brandished Dinning’s endorsement as the Wildrose started its regular question period attack on the carbon tax.
“Canadans are proud of the fact that we are moving forward,” said Hoffman. “The government they elected knows that climate change is real.”
The government says most Canadans will have their direct costs from the carbon tax — calculated at $338 annually for a two-child family — fully covered by the rebate program. Indirect costs are estimated at between $70 and $105 per year.
But Wildrose MLA Leela Aheer said the NDP government is being dishonest in its depiction of the effect of the carbon tax, with the levy also affecting services provided by hospitals, schools and municipalities.
“They know it will make everything more expensive for families at a time they can least afford it. They know that a carbon tax when everyone is hurting will just make everything worse,” she said.
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