Revenue neutral carbon tax idea gets rough ride in legislature – Telegraph Journal, 5 December 2015

article by Chris Morris
originally printed in the Telegraph Journal, 5 December 2015

“We should collect (carbon tax) where carbon comes into the economy by putting the price on industries importing the carbon and then take that revenue and put it back into the hands of people and businesses and municipalities to take action to reduce emissions.” – David Coon

The prospect of a “revenue neutral” carbon tax as suggested by Premier Brian Gallant was greeted with derision by opposition Tories on Friday who said such a tax would never be revenue neutral for New Brunswick consumers.

A possible carbon tax has been raised by Gallant as the Liberal government ponders pricing carbon to reduce greenhouse gas emissions.

It will be one of the issues considered as Gallant and other members of a small New Brunswick delegation head to Paris this weekend to assess the province’s carbon-reducing options as part of the Paris climate change talks.

Gallant has said a carbon tax, if it was to be put in place, would be revenue neutral but it’s unclear how that would be done and who would be affected.

“It’s a misnomer,” Opposition Tory leader Bruce Fitch told reporters after question period.

“‘Revenue neutral’ is not revenue neutral for the person reaching into their pocket and paying a higher price at the pumps.”

Fitch said New Brunswickers can’t afford more taxes.

He said a cap-and-trade system would be easier for consumers to accept since it applies to industry.

“It is not reaching directly into the pockets of taxpayers,”Fitch said.

“It says to industry,‘Okay, if you want to increase your emissions, you either have to make an arrangement to buy credits or pay for the increased emissions. But it seems Gallant is sold on this carbon tax idea because the feds think it is trendy.”

The premier said in the legislature that Fitch is putting the cart before the horse. He said no decisions have been made when it comes to carbon pricing.

“We are looking at all options and all mechanisms and at different jurisdictions to fully understand what we can do as a province to play our role when it comes to fighting climate change,” Gallant told the House.

“We need to grow our economy and create jobs, but we need to do that in a sustainable way. That is why we are going to enhance our role when it comes to fighting climate change in a responsible manner. … A price on carbon is something that we are considering as well.”

Gallant has repeatedly pointed to an agreement the province signed with Eastern premiers and New England state governors earlier this year to reduce greenhouse gas emissions by 35 to 45 per cent under 1990 levels by 2030.

The premier describes those targets as“ambitious”and says both a cap-and-trade system or a carbon tax are on the table.

Alberta has announced it would impose a carbon tax by 2017, a $20-a-tonne price on carbon emissions that will cover about 90 per cent of the economy, including essentials such as gasoline and home heating fuel. That price will increase to $30 the following year.

It also plans to put a cap on oilsands emissions and rid the western province of coal-fired electricity by 2030.

Quebec and Ontario formally joined with California this year to participate in a cap-and-trade market.

British Columbia introduced a carbon tax in 2008.

David Coon, leader of the Green Party of New Brunswick, said whatever carbon pricing mechanism is used, the critical issue to remember is that it’s simply a way to generate revenue for investing in reducing greenhouse gas emissions.

But he said making consumers pay more would be“regressive.”

“We should collect where carbon comes into the economy by putting the price on industries importing the carbon and then taking that revenue and putting it back into the hands of people and businesses and municipalities to take action to reduce emissions,” Coon said.

“It could really achieve significant benefits all around.”