The federal government is set to release a discussion paper Thursday outlining how it plans to impose a national carbon tax that will include flexibility for provinces who are at least working towards implementing their own plans, CBC News has learned.
Provinces that already have a carbon tax, such as British Columbia and Alberta, or plan to impose a carbon price through a cap and trade system, such as Ontario, Quebec and Nova Scotia, will not be affected.
Provincial sources and those briefed on the federal plan tell CBC the Liberals are hoping to copy the Alberta model for its proposed carbon tax.
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Under a deal reached late last year, the federal government wants every province to have some kind of price on carbon by next year and would impose one in 2019 for those provinces that failed to do so.
But the sources said there may be some flexibility if a province is on the verge of approving its own carbon tax, the federal plan will not be imposed Jan. 1, 2019.
Ottawa has set a starting price of $10 a tonne on carbon dioxide emissions in 2018, increasing to $50 a tonne by 2022.
So far, five provinces already have a price on carbon.
Four others have promised to bring one in, though they are at different stages of coming up with plans. Those include Manitoba, New Brunswick, Prince Edward Island and Newfoundland and Labrador.
Only Saskatchewan has steadfastly refused to bring in a carbon tax and is threatening to take the federal government to court.
Prime Minister Justin Trudeau, left, and the premiers reached agreement on a pan-Canadian climate framework in December, though Saskatchewan Premier Brad Wall and Manitoba’s Brian Pallister did not sign the agreement. (Sean Kilpatrick/Canadian Press)
The federal government has promised that any money raised from a federal carbon tax would be returned to that province.
Thursday’s discussion paper will outline different ways that funding could flow. That could range from a lump sum payment to the provincial government or some kind of rebate to businesses and the public.
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Provinces must have a carbon pricing system in place in order to tap into various green pots of money announced in the last two federal budgets.
Ottawa and most of the provinces and territories reached a framework deal last December on cutting greenhouse gasses to meet Canada’s Paris Climate Accord commitments. The possibility of a federal carbon tax for provinces that didn’t implement their own plan was part of that agreement.
The federal Liberals were under pressure to have a plan to lower greenhouse gas emissions before it approved more pipelines to carry crude to market.
Prime Minister Justin Trudeau campaigned on the dual promise of protecting the environment and developing energy resources at the same time, saying often that improving the economy and the environment go hand in hand.