NS liberals call on Tory government to offset pain of July 1 carbon tax at gas pumps

Nova Scotians will pay an extra 14.31 cents per liter of gasoline at the pumps from July 1, but the Liberal caucus says the increase could have been avoided.

“Our caucus is here because in two weeks Nova Scotia will experience the largest increase in gas prices in the entire country,” said Liberal leader Zach Churchill, who was joined in the foyer of Province House Wednesday morning by nine liberal members of the caucus. .

Churchill said it is very important that Nova Scotians know why we have arrived at this point.

“We all know the impact climate change is having on our county and our world,” CHurchill said. “We’ve been through the last few weeks with the biggest wildfires we’ve ever had in the history of this county.

“We know that the best way to combat climate change is to price pollution, but how do we price pollution? In Nova Scotia, we successfully negotiated a cap-and-trade system in 2017 that priced pollution in this province at the same rates as a carbon tax, but protected consumers at the pump.”

Churchill said this was especially important for Nova Scotia’s rural residents, who have to travel farther because of where they live.

From 2019 to 2022, Churchill said that under the cap-and-trade system, Nova Scotians would have to pay just over a penny extra as a carbon price.

“In 2022, Prime Minister (Tim) Houston has smashed the cap-and-trade system in Nova Scotia without negotiating a viable alternative to price pollution in our county,” he said.

The result, he said, is the increase of 14 cents per liter at the pump on July 1. The increase is even more pronounced – 17.38 cents per liter – for diesel and light fuel oil, including heating oil.

Looking for trouble

Churchill said the Tory government prioritized politics and feuding with the federal government over the needs of the people of Nova Scotia.

“He would rather have the chance to blame the situation on the federal Liberal government rather than take responsibility himself,” he said of Houston.

Bruce Cheadle, a spokesman for the federal Department of Environment and Climate Change, confirmed the price hikes at the pumps and at the door for heating oil in an email Wednesday.

“Nova Scotia previously had a cap-and-trade system with weak stringency, resulting in a carbon price of about 1.1 cents per gallon of gasoline,” Cheadle said. As a result, while the federal fuel tax in Nova Scotia will be the same rate as in all other provinces and territories using the federal (carbon tax) system, the July 1 incremental increase (in Nova Scotia) will represent almost the full carbon price .”

Cheadle and the federal ministry say it’s important to note that the first payments for the pollution price reduction will arrive in Nova Scotians’ bank accounts or mailboxes on July 14, and “the first quarterly payment represents three months’ worth of price reduction for pollution, meaning households are not out of pocket for fuel costs.”

The federal department says a family of four will receive quarterly payments of $248 every three months, starting two weeks after the fuel levy goes into effect.

Better of?

“According to Finance Canada, and because of the design of the pollution pricing system, a majority of households will get back more rebates on the pollution price than they will pay in fuel costs,” Cheadle said by email.

All pollution tax revenues are returned to the jurisdiction where they were collected, with 90 percent going directly to households in the form of the quarterly rebate payments. The remaining 10 percent supports trade-exposed companies, farmers and indigenous peoples.

The Nova Scotia program offers a quarterly credit of $124 for an individual, $62 for a spouse or partner, $31 per child under age 19, and $62 for the first child in a single-parent household.

Iain Rankin, the former Liberal prime minister and provincial environment minister and now the party’s shadow minister for climate change, said there was no doubt the federal rebates will help minimize the impact of the carbon tax.

“There were certainly concerns expressed by the parliamentary budget officer in Ottawa,” Rankin said. “Rebates are helpful and we’re happy with some rebates, but by getting rebates, we’re actually giving up revenue that the county used to bring in to fight climate change, so this program will do less for the environment and will also cost people more on the gas pumps.”

In March, parliamentary budget officer Yves Giroux released a report finding that Nova Scotia, Prince Edward Island and Newfoundland and Labrador would follow the same trajectory as other Canadian provinces, which would represent a net loss on average for most individuals and households when the carbon tax and the incentive discount program are executed.

Rankin, provincial environment minister when pollution pricing became the law of the country in 2017, said provinces then had a chance to negotiate a deal that best suited them.

Some provinces, such as Quebec, already had a cap-and-trade program, and British Columbia, for example, had already imposed a carbon tax on the pump.

The previous Nova Scotia government negotiated a deal that respected our existing taxes in our electricity sector, and to be clear, we proved those actions were equivalent to a $50 per ton carbon tax,” Rankin said.

That’s what the carbon tax is currently, he said, but new federal law will increase it by $15 per ton per year starting this year and through 2030.

Rankin said the Nova Scotia deal has saved Nova Scotia 10 cents a gallon at gas stations over the past four years, while also raising much-needed money, in the range of $100 million, for programs to combat climate change.

“This is exactly the system that the Houston government scrapped,” he said.

The Liberal caucus was unable to provide an estimate of gasoline prices on July 1 under a revamped and renegotiated cap-and-trade program, but Rankin said we know there is one county that has a cap-and-trade program maintained and gas there will increase by less than 10 cents per liter on July 1.

The Liberals say nothing can be done now about introducing the carbon tax, but there are three things the government can do immediately to help Nova Scotia’s seniors and most vulnerable cope with the increase.

“One is cutting income taxes, which will allow Nova Scotians to keep more money in their pockets,” Churchill said. “Two, freezing the provincial portion of the gas tax (currently a flat rate of 15.5 cents per liter of petrol and 15.4 cents per liter of diesel) to reduce the impact of carbon prices at the pumps, and three, to universal lunch program in our schools to help those working families cope with rising food costs.”