If you are not aware that Canada puts a charge on carbon emissions, you have been living in a cave.
Pierre Poilievre calls it a “carbon tax,” and warns us all that it is “a tax on everything.” Sometimes he also blames it for the high price of groceries, cars, rent, clothing, etc. He also claims it's a tax on jobs.
Some of you may have noticed that I style myself a “recovering scientist.” Let me explain: I see what everybody sees, but my brain is wired to ask questions and think about things.
One winter, walking with one of my daughters, I pointed to a house with large icicles hanging from its roof. I explained the icicles were caused by poor insulation. Heat “leaking” from the living space melts snow on the roof. As the water runs off, it freezes forming the icicle. I challenged her to find icicles on our house. There were none.
I have tracked household energy consumption for 35 years. (Yes, I’m a nerd.) It was easy to tot up the “carbon tax” for heating our house in 2023. It came to $200.42. Our car, a Volkswagen Golf, used 617.3 litres of diesel fuel that year. The carbon tax on that came to $108.64 — so, a total of $309.06.
However, our 2023 carbon rebate came to $732.00 — that’s 2.4 times what we paid. More than 75 per cent of Canadians get back more than they pay on their gas bill and at the pump.
Of course, if you insist on commuting to Toronto in a tall, wide, three-tonne vehicle, or if your house is drafty, the rebate may not cover what you pay to emit carbon.
You could use the rebate to double the insulation in your roof space, or to replace your large vehicle with a smaller, lighter, fuel-efficient one. The carbon charge is not a tax, because you get it back. You are also free to spend your rebate on beer at your neighbourhood convenience store.
The purpose of the carbon charge is clear: It encourages Canadians to burn less fuel.
The carbon charge is set up to return 100 per cent of what we pay to us all — equally. There are winners (the majority who receive more) and losers. The biggest beneficiaries are folks who do not own a car. They can use the carbon rebate to help pay for transit.
Poilievre, the Conservative leader, claimed, loudly, “the carbon tax is a tax on everything.” Of course, he is correct. But let’s take a closer look.
In 2017, 90 per cent of Canadian freight moved by truck. Imagine the roast beef at $13 per kilogram in today’s store flyer came from Alberta, 3,500 kilometres away.
A highway 18-wheeler uses between 30 and 40 litres per 100 kilometres. Assume fuel consumption is 35 litres per 100 kilometres. The trip from a Calgary abattoir uses 1,225 litres of fuel.
At today’s carbon charge ($0.2065 per litre), that comes to $253. But that’s for 30 tonnes of cargo. Simple arithmetic gives $8.43 per tonne or just $0.008 per kilogram of beef.
I am wearing a shirt weighing 250 grams — with packaging, let’s call it a half-kilogram. If it arrived in Vancouver by ship and travelled by truck to Toronto (4,300 kilometres), the truck would use 1,500 litres of fuel with a $300 carbon charge. That would come to $0.01 per kg or less than half a cent for the shirt.
I do not know the cost of heating a shopping mall or grocery store, but you can be sure the carbon charges, spread over the amount of merchandise sold, would be similarly trivial on a per-item basis.
So, Poilievre’s statement “a tax on everything” is correct. However, he misleads Canadians into thinking that removing the carbon charge would — magically — make life more affordable.
Clearly, that is untrue. Even a tripled carbon charge would still be a tiny cost to the consumer.
However, the trucking company sees that $300 to carry goods from the west coast differently. It will work hard to improve fleet fuel efficiency.
That has been happening over the past few decades. Trucks “sprouted” aerodynamic add-ons to reduce turbulence between cab and trailer, and to prevent turbulence under the trailer. Some even attached “wings” to the rear of trailers smoothing airflow behind the vehicle.
And that’s the intent behind a consumer carbon charge. When you replace windows, buy ones with low-emissivity glass and triple glazing. Most of the cost is labour for installation. Specifying the best costs no more in labour, but reduces winter heat loss, and decreases summer heat gain.
The same argument applies to furnace replacement, draft proofing and other energy efficiency changes.
When I was a child, half of Canadians smoked. Now, 70 years on, smoking is a dying habit. That was largely accomplished by high taxes on tobacco, making smoking costly. Does anyone regret that?
Carbon emissions and climate change are today’s emergency. Poilievre argues (correctly) that Canada’s emissions are trivial on a worldwide basis. However, if we, as a wealthy country, are not willing to reduce our hydrocarbon consumption, what message are we sending India, Brazil or South Africa? We must lead.
Along the way, our scientists and engineers may develop key carbon-control technologies that can be sold to others.
However, Canada’s carbon charge has a serious flaw.
As the charge rises, it increases the price of Canadian products such as wheat, soy beans, lumber, paper, minerals, automobiles, etc. Farmers pay more for fertilizer, pesticide, fuel to run their equipment, and heat to dry their grain. Gradually, they lose in competition with countries lacking a carbon charge (China, the United States, Brazil, etc).
The Canadian government should restructure the carbon charge to work like the Goods and Services tax (GST). This is levied on most goods sold in Canada, except children’s clothes, groceries and rent.
To “level the playing field,” the GST is also charged on imports. It is rebated on goods leaving Canada, so does not penalize exports. The carbon charge needs to become an internal levy on all goods bought within Canada, regardless of origin.
A good example is aluminum. Smelting in China yields 13 times more carbon than the same metal smelted in Quebec or British Columbia, according to a story published in The Economist in December 2018.
Our aluminum is smelted using hydroelectricity while more than 60 per cent of Chinese power comes from coal. That’s important because China smelts half the world’s aluminum. A carbon charge on aluminum could make goods containing Chinese-smelted metal unsaleable here.
A restructured carbon charge makes sense for Canada. Over 80 per cent of our electricity, the main energy used by industry, is already carbon-free. As our carbon charge rises, proportion of renewable electricity will rise even more, “greening” our economy and attracting industries wishing to become carbon-free.
When Poilievre calls for a “carbon-tax election,” ask yourself if your rebate is more than what you pay.
And, keep in mind that as the carbon charge rises, carbon capture and storage projects become more profitable and more likely to be built.
“Axe the tax?” I see it as “axe the facts.”
Barrie resident Peter Bursztyn is a self-proclaimed “recovering scientist” who has a passion for all things based in science and the environment. The now-retired former university academic has taught and carried out research at universities in Africa, Britain and Canada, and is a former NDP candidate. As a member of BarrieToday’s community advisory board, he also writes a semi-regular column.
