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Op-Ed: Powlowski on why he voted against motion to lift carbon tax on heating fuels

Thunder Bay-Rainy River Liberal MP explains why he voted no on the motion introduced by the federal Conservatives to temporarily lift the carbon tax on all heating fuels
Marcus Powlowski, the Member of Parliament for Thunder Bay—Rainy River

First, this is a purely symbolic vote. The motion is designed in such a way that even if a majority of the House voted in favour of the motion, the Carbon Tax and underlying policy would not be impacted in any way. 

Second, although the Conservative party of Canada would like to claim that the carbon tax is the primary driver of the increased cost of living, this would seem to be simply untrue.

To that end, there are a lot of misconceptions about the carbon tax, I would like to address. First, the Carbon Tax was not created to generate revenue, as the revenues of the Carbon Tax are returned to the province where they were collected. Ninety percent of those funds are then further returned to Ontario households in the form of a rebate. The reason the Carbon tax is designed this way, is to change behaviour — as the homeowners with large properties and several gas burning cars, as well as industries that release the most greenhouse gases will pay more in the form of the Carbon Tax than they receive in rebates. Yet, 80 per cent of all Canadians get back more in the rebate than they pay either directly, or indirectly, in Carbon Tax. I know many people do not believe this but the Parliamentary Budget Office confirmed this point in a report released this spring, concluding that the average amount that people paid in the four provinces where the carbon price applied in 2021 was $555. The average rebate was $804. Additionally, the existing evidence indicates that Carbon Taxes work, as British Columbia implemented its own provincial Carbon Tax in 2008, contributing to 15 per cent reduction in Carbon Emissions by 2015 with no discernible negative impact on the economy. 

Critically, even in the context of heating fuels the rebate is still a net benefit, as the Enbridge website concedes, "for the average Ontario household, the federal carbon charge will add about $273-$297 to your annual natural gas bill between April 2023 and March 2024 (depending on your location)". In comparison the average family of 4 in Ontario will receive a rebate of 976$ in the upcoming fiscal year. 

Yet, the Conservative argument isn't just about fuel — according to Pierre Poilievre most of what is wrong with the economy is due to the Carbon Tax. According to him, it also accounts for most of inflation and the high price of foods. This argument also seems to be wildly overstated. Recently the Bank of Canada estimated that the carbon price contributed about 0.15 percentage points to inflation overall. Furthermore according to Calgary economist Trevor Tombe the carbon tax is responsible for less than one per cent of grocery price increases.

Third, I question Pierre Poilievre sincerity in volunteering to go on TBT News in order to assert that their elected MPs were unable to get the same exemptions from the carbon tax that Atlantic MPs got for their residents. Again this is, with one exception, simply untrue. Rural residents throughout Canada (not just the Maritimes) will get an added 10% increase (on top of the present 10%) in their Carbon Tax rebates. In addition the temporary pause on having to pay the carbon tax on heating oil applies to all Canadians. The one advantage that three Atlantic provinces will have is that low and middle income people who use oil furnaces, will get an additional $10,000 on top of the $10,000 all Canadians are currently offered to transition to a heat pump. The extra money will come half from the province, half from the federal government. If the Ontario government is interested in this policy they could get the same deal.

I also want to clarify why the government elected to temporarily drop the tax on heating oil and not on propane and natural gas? There are sound reasons for this — the most important of which is that the cost of heating with oil is significantly higher than heating with other heating fuels, particularly on the East Coast. Moreover oil produces more greenhouse gasses than the other fuels. To top it off people who continue to use oil furnaces are often those who are unable to afford transitioning their homes to cheaper forms of heating. This ironically results in the poorest people often having to pay the most to heat their homes. So the people most in need of a temporary financial break, in order to transition to greener forms of heating, are people who heat with oil.

The fourth reason I oppose the motion is because I support carbon pricing. Furthermore I am a little mystified by the Conservative opposition to the tax. Mystified because many conservative economists believe carbon pricing is one of the most effective means of reducing GG emissions and addressing climate change.

Some examples of hardly leftist institutions  that supported the carbon tax include; the American Enterprise Institute (in 2009  but like some other conservatives reversed position in 2022).  World Bank (2023), Canadian Business Association (2019), Ontario Chamber of Commerce (2021), the Canadian Chamber of Commerce (in 2018)

Even the Conservative Party in the last election ran on a platform that included a form of carbon tax. The Conservative Party has obviously flip-flopped on this because carbon pricing, in addition to being one of the most efficient tools in lowering greenhouse gas emissions, is also notoriously politically risky because yes — no one really likes taxes. But we need them. 

I don’t know under what rock the Conservative Party has been hiding for the last few years- but I have been pretty shocked at the number of climate related disasters that have affected us almost daily here in Canada or in other parts of the world. These include  a heat dome in BC that killed over 600 mostly elderly people, wild fires that burned down Lytton, B.C., other fires that forced the evacuation of towns in Alberta, Northwest Territories, B.C., and the Maritimes. Flooding was a big problem across the country whether in B.C. or in the Lake of Woods, Rainy Lake area. Hurricane Fiona which devastated the Maritimes. The ongoing impacts of permafrost and ice caps melting and contributing to an ongoing crises among Pacific Island states that are at risk of disappearing due to rising sea levels

And what is it the Conservative Party want to do? Get rid of one of if not the best tool we have to fight climate change.

I have tons of kids. The youngest is three. He didn’t do anything to contribute to global warming. Why should he, and his, and future generations, have to pay the price of a problem our generation created? I think it is morally incumbent on the leaders of today to act in their interests not just in the interests of those old enough to vote.

Now having said I will not support this symbolic vote for dropping the carbon tax I think we in government ought to always be thinking about how we can do better. Many people are struggling to pay their monthly bills. I think we can keep the tax and help to address their heating bills in other ways. 

People in the northern parts of provinces, like Ontario, ought to get a larger rebate than those who live in the southern part of the province. This is because people in the north clearly pay more to heat their homes. I have advocated for this in caucus and I will continue to do so. 

I think we should also look into whether we can provide more incentives in order to help people who heat their homes with propane switch to heat pumps.  Many people heat with propane because they can't get natural gas where they live. Given the high cost of propane (although less costly than oil), and the desirability of switching to heat pumps, perhaps we have to look at how we can improve the assistance available through the federal Greener Homes Initiative.

Although I do not support this motion, or removing the carbon tax on other heating fuels, I will continue to fight for the interests of the people of Northern Ontario and to try to help make their lives more affordable and ensure they get a fair deal. I just do not think this motion is in our long-term interest.” 

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