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Rivers: When is a Tax Not a Tax ?

Rivers 100x100By Ray Rivers

April 18th, 2021

BURLINGTON, ON

OPINION

When you are wrong, you are wrong. The adult thing to do is to just admit it. The debate on carbon taxation is over and Mr. O’Toole has his job cut out educating those dinosaurs in his party who couldn’t even concede that climate change is real.

o'tOOLE SMUG 1

With O’Toole’s ‘green’ rewards, the more often you fill up your car the more more points you earn.

Everyone had been expecting to see his long promised Tory environment policy, ‘Secure the Environment’. But no one expected O’Toole to include a carbon tax, after all the criticism he had heaped on that idea.

Perhaps that is why O’Toole’s tax actually resembles a loyalty card, a kind of Petro-Point collector. Though since it is mandatory, it’s still a tax, something he doesn’t get. And he clearly also doesn’t understand that the incentive should be to reduce green house gas emissions. With O’Toole’s ‘green’ rewards, the more often you fill up your car the more more points you earn. And those points in your personal low carbon saving account entitle you to a ‘green’ prize of the government’s choosing – rather than a guaranteed fixed rebate on your taxes each year.

Some environmental groups have lauded O’Toole though they note that the bar for him to jump was pretty low. And this may all seem like heady stuff for the Tories, but his environmental plan reads like something the Liberals might have written a couple of decades ago – before we all wasted so much time talking about climate change instead of doing something about it.

Setting a goal of 30% for electric vehicles (EV) sales by 2030, may sound new age, but 30% pales when compared to Quebec’s decision to ban all gasoline car sales by 2035. And the Tory policy document offers no real plan on how to get there.

For a party which sells itself as a tax fighter and calls out its opponents as big taxers and spenders, fiscal conservatives will be holding their noses on election day. There are new taxes proposed for luxury vehicles, frequent flyers and even second homes, in addition to the new carbon tax. It is no wonder that the folks at the Taxpayers Federation are going ballistic, calling O’Toole out for breaking his promises.

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Another billion for car battery development, another billion for hydrogen power from natural gas and five more billion for carbon capture and sequestration

And there are billions of dollars in new spending thrown in, as if the traditional Tory pre-occupation with debt no longer matters. There is a billion promised to develop mini nuclear power plants, another billion for car battery development, another billion for hydrogen power from natural gas and five more billion for carbon capture and sequestration – which involves pumping oil sands emissions into the ground and praying they will stay there.

O’Toole has borrowed from Andrew Scheer’s environment playbook, promising more natural gas exports to other countries to help them reduce their coal burning, whether they want it or not. And that probably would lead to more discussion of new pipelines. Interestingly he has backtracked on his party’s opposition to the Liberal’s low carbon fuel standard much as he has now accepted federal carbon pricing for industrial polluters.

There is a brief mention of ‘carbon border trade tariffs’ to level the field for Canadian companies competing against producers in other countries with less constraining environmental standards. This is something the Biden administration is also considering, though it’s an uphill battle against the free trade lobby. Still O’Toole is only committing to study the idea.

While O’Toole talks about increased energy supply he ignores the lowest cost option, the lowest hanging fruit – renewable energy. The Biden administration, south of the border, is banking on wind and solar to drastically shave US carbon emissions. Driving electric or hydrogen powered vehicles will not get Canada to its carbon goals if the electricity that charges/powers them comes largely from carbon based fuels.

O'Toole smug 3

O’Toole’s proposed carbon tax is seriously flawed and may actually lead to increased carbon emissions, rather than reduce them

O’Toole understands that the party he leads is out of step with the majority of Canadians, even in Alberta, who expect the country to deal with its pollution and meet its international climate goals. ‘Secure the Environment’ was intended to correct that imbalance. Unfortunately the plan is still too ideologically driven and still too overly consumed with a dying resource sector.

O’Toole’s proposed carbon tax is seriously flawed and may actually lead to increased carbon emissions, rather than reduce them. Further, his decision to introduce his own carbon tax and claim that it isn’t a tax, is shameful behaviour for someone aspiring to Canada’s highest office.

Why not just admit he’s changed his mind and now accepts the existing carbon tax framework, much like he has done for the industrial polluters. And why not confirm the reality that the carbon tax has neither proven a drag on the economy, nor overly hurt working Canadians. Otherwise he wouldn’t be promoting carbon taxation, even if by another name.

Rivers hand to faceRay Rivers writes weekly on both federal and provincial politics, applying his more than 25 years as a federal bureaucrat to his thinking.  Rivers was a candidate for provincial office in Burlington where he ran against Cam Jackson in 1995, the year Mike Harris and the Common Sense Revolution swept the province.

 

 

 

Background links:

Secure the Environment –    Loyalty Cards –    Worst of Both –

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19 comments to Rivers: When is a Tax Not a Tax ?

  • Hans Jacobs

    Re: “…carbon capture and sequestration – which involves pumping oil sands emissions into the ground and praying they will stay there…” That’s the most accurate description of it I have ever seen – wonderful!

  • Larry

    As usual, a half baked thought – poorly explained and will fail to fight the climate crisis

  • Phillip Wooster

    Ray, you must have received your “marching orders” from the Liberal propaganda ministry to start attacking O’Toole’s climate plan–there’s an election coming and the Liberals want to use this as a wedge issue. Predictably of course, you have omitted or distorted many of the false claims surrounding the Liberals plan.

    Liberals like to claim that a carbon tax is the most efficient way to reduce carbon emissions, citing the two economists, Nordhaus and Romer, who laid out this theoretical claim in their Nobel prize winning thesis. However, in itself, this is misleading. Nordhaus and Romer didn’t specify carbon taxes, they did specify carbon pricing which can take several forms, with a tax on end-use consumers which the Liberals favour just being one of the options. But most importantly, the two economists were bright guys–they figured out that carbon emissions were a GLOBAL problem that required–wait for it, a GLOBAL SOLUTION. That is why their thesis specified carbon pricing on a GLOBAL basis with penalties for countries that didn’t comply. Now Canada produces only 1.6% of global emissions but has a carbon tax to reduce this while China which produces nearly 30% of global emissions has no carbon tax. In fact, China–using its own numbers which are likely understated, expects to increase its coal consumption by 1 billion tons by 2030 while increasing its carbon emissions by at least 3 times Canada’s total emissions. It puts a lie to the Paris Climate Accord as an environmental initiative–when China and Russia–two of the world’s largest economies and two of its worst emitters, are not part of the Accord before 2030; it is just a China initiative to weaken the economies of the Western democracies. Intelligent Canadians have figured this out.

    How serious are the Liberals about carbon emissions? In their first 4 years in power, they did not reduce emissions at all based on the data–in fact they rose from 723 mt. when they took office to 730 mt in 2019 (the last year for which we have data). Now you could argue that they only instituted the carbon taxes in 2019 so we can’t see the effect, but demand for energy is highly inelastic meaning that while taxes have gone up on carbon emissions, consumption creating them have fallen only marginally if at all (and this should make sense, people don’t just rush out and buy new vehicles or heating systems)–and the Liberals are counting on this, the Trudeau carbon tax is a REVENUE tax, nothing more, nothing less.

    Now let’s look at the falsehoods surrounding the Liberals’ carbon taxes. Lie #1–you get back more than you pay. Laughable on its face–if I get back more than I pay, what incentive do I have to change? But we know that for many, if not most Canadians, they pay far more than they receive in “climate tax rebate”. Any Burlington resident who commutes to work with a car, has less than 2 children in the family, and lives in their own home pays more in DIRECT carbon taxes than they receive in rebate. Only Ontario families with many children, living in a small dwelling, and not commuting far to work receive more. In this respect, the carbon tax operates as a massive income redistribution scheme. However, the Liberals don’t include INDIRECT CARBON TAXES paid in the form of higher prices in their calculation. So it is doubtful that any families are better off. Of course, the Liberals don’t want you to know this. And this is quite apparent if you go on FB and check two Liberal environmental sites–Fair Path Forward & Clean Prosperity (same site actually)–operating out of 1 Yonge St–same address as the Toronto Star. One of their posts asks “Did you calculate your rebate”? Of course, they should be asking “Did you calculate your total carbon costs?” but they censor any feedback that points this out. Want to know what the carbon tax will cost you by 2030? Check it out ttps://www.secondstreet.org/2021/03/29/new-poll-supreme-court-said-carbon-tax-legal-but-canadians-still-dont-want-it/

    Lie #2–only high income Canadians, because they consume more, pay more. Quite false, I’m lower middle income and I’m paying more in Direct Carbon taxes than I receive. And this should strike terror into all of you. When completing my income taxes, I discovered that higher income Ontarians actually have their rebate reduced as their income rises. How long until the Liberals reduce the threshold to keep more of the Direct Carbon Taxes?

    Ray, you have stated that carbon taxes don’t seriously hurt working Canadians but I would argue that any Burlington residents with a small family and living in their own homes are out anywhere from $500 to $1000 per year when both direct and indirect carbon taxes are considered. And they don’t act as a drag on the economy??? Really, the HST on the carbon taxes alone sucks a billion dollars per year out of the Canadian economy. And when it takes money out of Canadians pockets, that creates a drag–lots of it.

    • David Barker

      Mr Wooster. You must have received your marching orders from O’Toole and PC central.

      I note your entire commentary was a (repeat) criticism of the Liberal govt’s carbon pricing tax plan. You and the PCs had previously decried carbon pricing as a way to attack emissions. And yet now we have the PCs putting forward a carbon pricing plan. A plan which could be viewed as actually encouraging emissions because the more you burn the more O’Toolies you are credited.

      It is notable, Mr Wooster, you do not contradict anything Mr Rivers put forward in describing O’Toole’s plan. I say O’Toole’s plan as it seems the majority of the PC party does not even agree that climate change exists

      As to what China or any other country is or is not doing to combat climate change, Canada has no control over any of that. We can only do our bit and hope others do theirs. If they do not do their part, that does not mean we too should be irresponsible.

      So Canada voices its condemnation of Myanmar’s treatment of the Rohingya. Myanmar takes no notice of Canada or the rest of the world. Does that then mean it’s OK for Canada to mistreat our First Nation’s? Of course not.

      We as a country must do what is right, not what is convenient.

      • Phillip Wooster

        “We can only do our bit”. A staunch avowal of Liberal virtue-signaling–the only thing on which Liberals have done a superb job! No matter the cost to the economy and to the standard of living in Canada despite its total ineffectiveness–an exercise in total self-flagellation.

        Perhaps you can send your final comment to your idol, Justin Trudeau–“We as a country must do what is right, not what is convenient”–he certainly didn’t follow through on that when the Canadian Parliament, excepting Trudeau and his cabinet cronies who were MIA, voted to condemn China’s treatment of the Uyghurs.

        • David Barker

          Mr Wooster. I could listen to and take your comments more seriously if they were not always couched in Liberal bashing tones. As is the Trumpian way, copied by so many now, you try to deflect attention away from you not responding to questions asked of you by throwing mud at others.

          In the past you have on a number of occasions through this medium taken aim at the federal government’s carbon tax, whilst championing the PCs alternative plan to help combat climate change. A plan which was at that time unannounced and the details of which were unknown to you or me, and which now turns out to be a tax by another name.

          Are you supportive of the PC plan put forward by Mr O’Toole and the PC party?

          • Phillip Wooster

            Ever the Liberal apologist while avoiding the scam which is the essence of the Liberal climate plan, you are truly an ideologue. Sorry I exposed your hypocrisy in my previous post.

            For the record, I don’t support O’Toole’s plan. What O’Toole should have done was to adopt the carbon tax as such and weaponize it against the Liberals–make it truly revenue-neutral by: 1. eliminating the HST on the carbon tax–this exposes the reality of Trudeau using this tax as a revenue generator (currently sucks $1 billion per year out of the economy and climbing) 2. make sure to require the carbon taxes to be itemized on their gas receipts so that they would have the option to itemize their claim for a carbon tax rebate (this would stop the income redistribution program that is in part the Trudeau carbon tax). Liberals hate transparency, they would rather keep the taxes hidden. 3. allow business to claim a credit on the carbon taxes paid on operating expenses (they currently can’t do and it results in Canadians paying higher prices in the form of INDIRECT CARBON TAXES–another hidden Liberal trick). It ends up being in sharp contrast to the Liberals–transparent and totally revenue neutral. Of course, it does end the revenue tax and income redistribution scheme that Trudeau has foisted on Canadians.

          • David Barker

            Allowing business to gain tax credits for its use of carbon would negate the whole idea that by “cost penalties” business will reduce its carbon footprint. Those businesses with a smaller carbon footprint will be better positioned than those with a larger footprint.

            Governments of both stripes have employed tax on tax as seen at the gas pump. Personally, I would prefer prices be displayed in the same way as in the UK where the VAT component is buried in the displayed price. I find it annoying to see a price displayed at $9.99 when in fact the cost is actually $11.29. Obviously the differential between displayed price and actual cost is greater the higher the displayed cost.

            As Perry has said here, your aggressive and demeaning language does your argument no good.

          • Phillip Wooster

            “My aggressive and demeaning language does your argument no good”. What a joke! Liberals just can’t take criticism; Liberals have been so indoctrinated by Saint Justin that they just can’t conceive that they have been conned.

            In any case, what is important is that centrist voters in Burlington read the posts and start thinking for themselves. True Red Liberals are beyond redemption.

            Edited – some less than kind language – tone it down Phillip

          • Phillip Wooster

            By the way there are no “cost penalties”, business merely passes on the increased cost in the form of higher prices–YOU and I are paying the carbon taxes. Interestingly, you don’t apply the same type of thinking to providing rebates to households.

          • David Barker

            Because it is overwhelmingly business not individuals that creates greenhouse games and has yetti sized carbon footprints

          • David Barker

            Well we agree on something.

            But that something is so very obvious to all. Yes everyone agrees, it’s those voters who occupy the centre ground that will determine which party gains power. But just like the True Red Liberals, the Ultra Right Conservatives are beyond swaying. Note I do not use the word redemption, which you used in an insulting and demeaning way.

            The positioning of the Liberals and the Conservatives in the political spectrum gives the Liberals an advantage. The majority of those voting Liberal are, I would say, positioned quite close to the political centre. Whereas it seems, due to policy positions even the left wing of the Conservatives is positioned quite a bit right of centre making it hard to attract centrist voters.

            Oh, criticism is fine and most people can take it and will listen to an alternative perspective. But as soon as name calling, demeaning or insulting language is thrown at the audience, you lose the audience no matter the strength of your argument.

        • perryb

          The last refuge of the loser in a debate is the ad hominem attack on the speaker. Your last comment is just that with its snide references like “your idol”.

    • perryb

      So who are you getting your marching orders from? A whole page of doctrinaire bumpf basically claiming lies lies lies as a rebuttal to legitimate observations about O’Toole’s dilemma in managing his big tent. A ridiculous assertion that taxes suck money out of the economy. Please understand that most Canadians do not fit neatly inside a box labeled big-L liberal or big-C conservative, and desperately wish political junkies and apologists would stop assuming they do.

  • Carol Victor

    It must have been some discussion to put this together…..not as much an environmental policy but rather a marketing plan on how to turn yourself inside out and hope to beat the Liberals..
    The plan in itself is nowhere aggressive enough and lacks sincere party backbone to really address this most critical issue.

  • Fred

    The knuckle draggers and Oh’Tool have complained Liberals have a tax, when in fact you get an equal amount back in a rebate, so its a flow through. Yet the CONs claim they are not proposing a tax, but a mandatory levy. They claim its different, lol. Its not.

    The hypocrisy is laughable. The CONs weak program will do enough to meet climate change. They railed about carbon pricing for years and instead of acknowledging their mistake, they claim its something else. Worse, this points program forces consumers to spend money on things they may not want. I thought the CONs were the party of free choice and less government intrusion? Now you are going to tell me what car or bike to purchase?

    Even worse is the millions going to be required to administer this nonsense. Consumers wait hours to talk to a government drone about our taxes, now i have to call about my points? Are retailers taking my points? How do they get paid for my government issued bike?

    I hate these people who dream up this crap with no plan about the realities of implementation. Oh’Tool is a joke.

  • Denise W.

    I don’t think now is the time for expensive wokery. Canada needs Alberta and the petro economy; up and running. Oil sands are not that bad and cleaner than California oil. Yet nobody seems to acknowledge that. Our economy is hobbled too much right now. losing pipelines and allowing Alberta oil is not in our best interests. Yes we can pollute less and less.
    But keeping to a schedule, ignoring economic damage that has been done is a mistake. And trying to pay for things with higher taxes or new taxes will shut things down even more. Wind and solar have their problems too. Just the latest trend, not a real solution. Whatever it is, the real solution will take longer to realize.

  • Alide Camilleri

    So what happens to those of us who may get points but we are really too old to go out and make the kind of green purchases that O’Toole finds acceptable. He really has to get real. Not all of us can use rewards points.