October 22, 2020

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Carbon-tax compromise remains elusive goal

Editorial

Hey there, time traveller!
This article was published 22/1/2020 (273 days ago), so information in it may no longer be current.

Premier Brian Pallister and Prime Minister Justin Trudeau sought this week to assure Manitobans they are fully engaged in a "dialogue" to break the impasse between the provincial and federal governments on carbon taxes. There are good reasons to doubt those assurances.

Manitoba has been fighting with Ottawa since 2018 when, without warning or adequate explanation, Mr. Pallister killed plans to introduce his own $25-per-tonne carbon tax. As a result of that decision, Manitobans this past year were forced to pay a $20-per-tonne federal levy, known as the "federal backstop." The levy increases to $30 per tonne this year, and Ottawa plans to increase the backstop annually until it is at least $50 per tonne.

Mr. Pallister says he wants consent from Ottawa for Manitoba to levy its own tax at a level that is below the backstop. Although Mr. Trudeau has rejected that proposal before, following a meeting between the two leaders this week in Winnipeg during a federal cabinet ministers’ retreat, there was a glimmer of hope that a compromise might be available.

Don’t hold your breath. Although the language was conciliatory, there realistically is very little room here for a compromise agreement.

MIKAELA MACKENZIE / WINNIPEG FREE PRESS</p><p>Premier Brian Pallister </p>

MIKAELA MACKENZIE / WINNIPEG FREE PRESS

Premier Brian Pallister

Mr. Pallister claims he is willing to discuss a new Manitoba green plan with a revised price on carbon, but he made it clear he does not want a tax that is going to slowly increase. And that means once you strip away all the diplomatic language, Mr. Pallister appears not to be offering Mr. Trudeau a negotiation, but rather an ultimatum.

Mr. Pallister claims he is willing to discuss a new Manitoba green plan with a revised price on carbon, but he made it clear he does not want a tax that is going to slowly increase. And that means once you strip away all the diplomatic language, Mr. Pallister appears not to be offering Mr. Trudeau a negotiation, but rather an ultimatum.

Of course, Mr. Pallister’s position suggests there is a quid pro quo: Mr. Trudeau needs help wooing other aggrieved Conservative premiers who have declared a holy war on the federal carbon tax. At a news conference following his meeting with the prime minister, Mr. Pallister indicated Manitoba is willing to be a "bridge" to calm future skirmishes with the leaders of Canada’s "conservative movement" — but only, it seems, if he gets a special deal that was not offered to other provinces.

That kind of deal will be hard to come by. Mr. Trudeau and his cabinet ministers have made it clear that Ottawa is not backing away from its desire to see a slowly escalating carbon tax imposed from coast to coast to coast.

Mr. Pallister has hinted that he may be willing to move off his number to ease negotiations. If that’s the case, then he should make his new number public as soon as possible and seek support from Ottawa. The longer Mr. Pallister delays, the longer Manitobans will have to wait for meaningful climate-change policy.

Although he has often lauded the Made-in-Manitoba Climate and Green Plan, it has been mostly a bust. Big-ticket items that would really reduce our carbon emissions — subsidies for electric cars, electric buses in Winnipeg and the electrification of gas-fired farm machines — have not been undertaken because Manitoba is not collecting its own tax and thus has no money dedicated to such initiatives. Ottawa is remitting funds from the federal levy to Manitoba, but most of that money is going to individual households in the form of rebates.

After nearly two years of continuing disagreement, a compromise by both leaders that leads to a meaningful and effective carbon tax plan would be in the best interests of all Manitobans. And, of course, of the planet.

Editorials are the consensus view of the Winnipeg Free Press’ editorial board.

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