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Manitoba scraps carbon tax in anticipation Ottawa will impose its own

But Premier Pallister wants Ottawa’s carbon tax to include the same exemptions for farmers as Manitoba’s

The Manitoba government won’t launch its Made-in-Manitoba carbon tax because Ottawa is imposing its own, but Manitoba is going ahead with the carbon reduction programs in its Climate and Green Plan.

The province also says when the federal government starts taxing carbon here the same exemptions for farmers set out under Manitoba’s cancelled tax should apply.

“For example, (on farm diesel) fuel, heating, cooling — those types of things that we had fought hard as a department to ensure that our farmers remain competitive on the world market stage,” Agriculture Minister Ralph Eichler said in an interview Oct. 5.

The province also wants Ottawa’s carbon tax to provide Manitoba’s big carbon-emitting companies the same flexibility as Manitoba’s scrapped tax.

On Oct. 27, 2017 the Manitoba government rolled out its highly anticipated plan to reduce carbon pollution through a combination of a carbon tax and a long list of greenhouse gas-cutting programs.

On Oct. 4, 2018 Premier Brian Pallister announced Manitoba is scrapping its flat $25-a-tonne carbon tax because Ottawa plans to impose its own escalating tax scheduled to hit $50 a tonne by 2022.

However, Pallister and Eichler stressed the initiatives set out in the Climate and Green Plan, as well as the $102-million conservation trust fund announced in the March 12, 2018 provincial budget, will go ahead even though Manitoba’s carbon tax won’t.

“I’m saying our plan, which is 67 pages (long), has 66 pages of mitigation activities and exercises and we’re going to be proceeding with those,” Pallister told reporters. “In fact I expect we’ll be strengthening those.”

Since Ottawa doesn’t respect Manitoba’s carbon tax Manitoba has two choices, Pallister said.

“Either you’re going to stand up for Manitobans in a year (2020), when the feds come in as they threaten to do with a higher carbon tax, or you do it now, and we’re doing it now.”

Bill 16, the Climate and Green Plan Implementation Act, will be amended this week to remove the carbon tax and the tax exemptions totalling an estimated $260 million over five year Manitobans were going to get, thanks to the revenues from the carbon tax, Pallister said.

The federal government says it will return some of the revenue from its carbon tax to taxpayers.

Robert Parsons, a resource economist at the University of Manitoba’s Asper School of Business, told CBC Radio Oct. 5, green plan initiatives, including increasing Manitoba’s biodiesel mandate to five per cent from the current two, would reduce emissions.

The Keystone Agricultural Producers (KAP) and Manitoba Conservation Districts Association (MCDA) said they were surprised by the government’s decision to drop the carbon tax, but pleased green plan programs will go ahead.

KAP invested a lot of time and effort developing a policy on the divisive carbon tax issue, eventually endorsing one despite some members’ opposition.

Agriculture emits 32 per cent of Manitoba’s carbon, second only to transportation at 39 per cent, KAP president Bill Campbell said in an interview Oct. 5. But agriculture can help sequester carbon and be part of the solution, he added.

KAP was also thankful the Manitoba government planned some carbon tax exemptions for farmers, recognizing that without them, farmers who compete internationally would be less competitive, Campbell said.

KAP wants the same exemptions under a federal carbon tax, he added.

“We will still need to fight to protect our competitiveness with jurisdictions that will not bear the costs of a carbon tax,” Campbell wrote in a letter to members last week.

“KAP is going to continue with the same approach it has taken on this issue since the beginning. We are going to talk to you, our farmer members, listen to your concerns and ideas, and deliver your message to the government, be it on Broadway or Parliament Hill.”

The MCDA will carry on business as usual and remains ready to implement any Climate and Green Plan program initiatives, association chair Ray Frey said in an interview Oct. 5.

However, scrapping Manitoba’s carbon tax still casts a pall over momentum that’s been building, he added.

“I think that things won’t happen as fast as we expected or wanted to or thought they should,” he said.

Pallister said he didn’t flip-flop on a carbon tax. The green plan states it is contingent on Ottawa accepting Manitoba’s tax.

“This is not a new position,” he said. “This is exactly what we hoped wouldn’t have happened if the federal government would respect Manitoba’s plan and Manitobans’ investments in green, but it doesn’t.”

Scrapping Manitoba’s carbon tax now brings clarity to the issue, he said.

Nor has Pallister’s view altered on climate change.

“The danger posed by climate change is real and it is serious,” he wrote in an open letter Oct. 3. “We see the evidence all around us, in warmer temperatures, both in the air and in the oceans. In the form of dangerous storms, which happen more frequently. In forest fires of unprecedented intensity, and in severe flooding that happens far more often. Climate change threatens our safety and our economy. It threatens our future, especially the future of generations that will follow us.”

– With files from Lorraine Stevenson

About the author

Reporter

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.

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