Jane Q. Canadian’s Carbon Tax Quandary

Contributed by Robert Lyman © 2018

Robert Lyman is an Ottawa energy policy consultant, former public servant of 27 years and prior to that a diplomat for 10 years.


On October 23, 2018 the Trudeau government announced that 90% of the revenues that it raises in carbon taxes from provinces that fail to implement their own carbon pricing regimes will be returned to households directly through rebates, starting in April, 2019.


Jane Q. Canadian, who lives in Weyburn, Saskatchewan, is trying to figure what this means, so she goes to her friendly climate expert.


Jane: Can you explain to me what’s going on?


Expert: Sure. Do you have two purses?


Jane: Yes. A black one and a brown one.


Expert: Well, the government is going to put $90 into your black purse.


Jane: Wow! That’s great. Just one question. Where will the money come from?


Expert: Oh, it will come from taxes on the carbon dioxide produced by goods and services sold in the economy.


Jane: What are those?


Expert: The taxes will be imposed on anything that uses oil, natural gas or coal, directly or indirectly.


Jane: I don’t understand. What or who uses oil, natural gas or coal directly?


Expert: Well, you do when you buy gasoline to fuel your car or natural gas to heat your house. So does everyone else, including private businesses.


Jane: What or who uses those fossil fuels indirectly?


Expert: You do when you buy electricity that is generated using coal. You also do when you buy things that have to be manufactured using energy or transported, distributed and marketed to you. Again, so does everyone else, including private businesses.


Jane: Gee, that includes almost everything I buy, even groceries. So, how much will that cost me?


Expert: Well, that depends. On average, the government will collect about $100 per person. It will come out of your brown purse.


Jane: Wait, you said at the beginning that I would get $90 deposited to my black purse. Now, you say that I will get $100 taken out of my brown purse. How does that make me better off?


Expert: I said that these things apply on average. Individuals may be affected differently.


Jane: How so?


Expert: It depends on how much they buy that uses energy, how much they change their buying habits and how companies react.


Jane: How does what the companies do affect me?


Expert: Well, only small companies will get carbon rebates. When other companies are taxed, they will respond in different ways. Some will raise their prices to recover the tax from their customers.


Jane: Customers? You mean me?


Expert: Yes, that’s right. Of course, the companies might try to reduce other costs instead, like salary costs.


Jane: Salary costs? My son works for a store. You mean it might lay him off?


Expert: It could. Of course, the company might accept a lower profit.


Jane: What happens when the carbon taxes go much higher? Can companies go on cutting profits indefinitely?


Expert: Some can for a while. Many, unfortunately, will just have to go out of business.


Jane: Which kinds of companies might have to go out of business?


Expert: The ones that produce a lot of carbon dioxide emissions as part of how they operate and have no way to reduce them with the technology now available.


Jane: Like who, for example?


Expert: Oil producers, natural gas producers, coal producers of any heavy industry that uses a lot of fossils fuels in its production, like mining, steel, or cement.


Jane: I work for the heavy oil plant here. You mean I could lose my job?


Expert: Yes, but it’s all to save the planet.


Jane: How will it save the planet?


Expert: It will reduce Canada’s greenhouse emissions.


Jane: Does that mean that global greenhouse gas emissions will go down?


Expert: No, because emissions are growing too fast in developing countries like India and China.


Jane: So, if global emissions will keep going up regardless of whether the Canadian government imposes carbon taxes, how are we saving the planet?


Expert: It’s the principle of the thing.


Jane: so, let me get this straight. I will get $90 in my black purse, but lose $100 from my brown purse, the prices of almost everything I buy will go up, my son may be laid off, and the company I work for may go out of business. There will be no actual environmental benefit.


Expert: That’s about right. There’s just one more thing.


Jane: What’s that?


Expert: Don’t forget to vote in next year’s federal election.


Carbon Kleptomania:


Carbon Kleptomania Report:


1 Comment

  1. Greg Vezina

    Beware of False Green Prophet$

    Canada needs honest viable energy and environmental policies based on science and economics, not on political rhetoric, nonscience or nonsense.

    Prime Minister Trudeau’s proposed carbon tax is a clear example of this because of the delay in keeping his December 9, 2016, promise to create a matching national clean fuel standard “based on life cycle analysis” billed as “the single biggest element of Canada’s national emissions reduction plan”.

    There are at least seven major types of pollution caused in the life cycle of the production and utilization of energy: abiotic depletion; acidification; eutrophication; global warming; human toxicity; ozone layer depletion; and terrestrial ecotoxicity.

    The Trudeau Liberal government’s proposed carbon tax applies to fossil fuels like coal, oil and bitumen, but exempts other forms of energy including natural gas used for power generation, which is worse over the 20 to 50 year time frame, and likely will so-called renewable fuels such as bio-fuels including those made from food crops, and biomass such as wood.

    The results of the recent Ontario Election reflect upon the failure of the Government of Canada to disclose the real cost of the carbon tax, how it will be used appropriately and in the public interest, the true life cycle production and utilization of all forms of energy, or the facts regarding the real economic benefits of their energy and environmental policies.

    The practice of letting politicians and civil servants make and implement policies that create winners false green prophet$ for their chosen technologies and multibillion-dollar losers out of the rest of us has been proven wrong in every instance, as was confirmed by Ontario’s last two Auditors General.

    The International Energy Agency (IEA) and the UN’s Intergovernmental Panel on Climate Change (IPCC) both now officially warn that growing crops to make “green” biofuel harms the environment and drives up food prices, and rather than combating the effects of global warming, they could make them worse.

    With one child under 10 dying from hunger and related diseases every five seconds now according to the UN, using food for fuel is actually a crime against humanity.

    This applies to other so-called renewable energy sources like wood biomass, shown as not being “carbon neutral” at all, because the immediate harm from releasing the carbon in it and the fifty years or more needed to grow the trees to replace it actually makes it worse.

    Taxpayer subsidies, mandatory use laws and exemptions from carbon and life cycle taxes further increase the negative impacts of these pseudoscience based policies.

    That’s why the user-pay life cycle clean fuel policy should have been fully formulated and implemented before any other steps were taken.

    We need to find ways as a country to economically and sustainably develop and utilize our vast fossil fuel and renewable energy resources to our advantage, instead of exporting them for the benefit of others at huge discounts while unnecessarily increasing life cycle environmental impacts.

    According to Bill Gates, whose multibillion-dollar Breakthrough Energy Coalition now targets carbon-free ammonia energy, we should end all energy subsidies and spend our resources developing new and better technologies for all fossil and renewable energy production and use.

    Gates’ most read and recommended author, University of Winnipeg’s Dr. Vaclav Smil’s June 3, 2018, IEEE Spectrum article, “A Critical Look at Claims for Green Technologies”, is subtitled “Green technologies are not yet proved, affordable, or deployable—but even if they were, it would still take them generations to solve our environmental problems.”

    Alberta Premier Rachel Notley should join Saskatchewan Premier Scott Moe and Ontario Premier Doug Ford in their proposed legal challenge to Trudeau’s unjustified carbon tax grab scheme using plans to implement realistic life cycle energy and environmental tax policies.

    We need a level playing field for energy, and everything else for that matter, so consumers and industry can vote with their wallets in a true user-pay economy that doesn’t pass off the real costs to anyone else.

    By: Greg Vezina, Chairman, Hydrofuel Inc. and leader of Ontario’s None Of The Above Direct Democracy Party.

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