Ottawa hiked carbon tax during crisis while other nations reduced theirs: Taxpayers Federation

Thursday, May 14, 2020

OTTAWA, ON: The Canadian Taxpayers Federation is calling on the federal government to reverse its carbon tax hike as other jurisdictions have paused or lowered their carbon taxes during the COVID-19 crisis. The CTF is providing the international comparison as part of its annual Gas Tax Honesty Day initiative, which shows drivers how much of their fuel bills are actually taxes.

“The federal government hammered Canadians with a carbon tax hike during a health and economic crisis while our international peers are freezing or reducing their carbon tax burdens,” said Aaron Wudrick, Federal Director for the CTF. “Canadian families and businesses need relief now and the federal government should follow international leaders and reverse its carbon tax hike.”

On April 1, the federal government increased the carbon tax from $20 per tonne to $30 per tonne, which is about 6.6 cents per litre of gasoline.

While the government of Canada is increasing the federal carbon tax by 50 per cent, most countries don’t collect carbon taxes at all. In fact, according to the World Bank, only 23 per cent of countries representing 15 percent of worldwide emissions are covered by a carbon tax.

However, for the minority of jurisdictions with a carbon tax, many are freezing or lowering their carbon taxes due to COVID-19, including:

British Columbia delayed its planned carbon tax increase.
The European Union’s cap-and-trade tax rate has fallen about 32 per cent due to COVID-19 crisis.
Estonia’s finance minister called for his country to consider leaving the EU’s carbon tax scheme and lowered fuel and energy taxes.
Newfoundland and Labrador froze its carbon tax rate at $20/tonne.
New Zealand’s cap-and-trade carbon rate fell about 23 per cent due to the COVID-19 crisis.
Norway has delayed carbon tax payments and provided numerous exemptions for its carbon tax.
South Africa has deferred carbon tax payments until Oct. 31, 2020.
The United Kingdom froze its carbon tax top-up rate (which was scheduled to increase).
Western Climate Initiative (Quebec and California) cap-and-trade tax rate has fallen due to COVID-19 crisis.

“There is no worse time to hike taxes than during an economic downturn,” said Wudrick. “The federal government needs to stop making tough times tougher and reverse its tax hike immediately.”

The Canadian Taxpayers Federation’s 2020 Gas Tax Honesty Day report is available here.

For more information call:

Aaron Wudrick, CTF Federal Director Cell: 613-295-8409

Email: awudrick@taxpayer.com Twitter: @awudrick

The CTF is Canada’s leading non-partisan citizens’ advocacy group fighting for lower taxes, less waste and accountable government. Founded in 1990, the CTF has more than 235,000 supporters and seven offices across Canada. The CTF is funded by free-will, non tax-receiptable contributions.