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BC: The People Must Be Heard on Carbon Tax

Author: Jordan Bateman 2012/08/15

Our recommendation to scrap the carbon tax—including the corresponding tax credits—has sparked a lot of media attention since Wednesday.

But in a troubling turn late Tuesday night, Finance Minister Kevin Falcon came out and said the carbon tax was here to stay. This despite the fact public consultation on the future of the tax doesn’t close until August 31. Why is his mind already made up?

Falcon’s comments spark a few thoughts. He says, “it has contributed to significant income tax reductions for British Columbians.” Actually, it has contributed to a 5 per cent cut in the bottom 2 tax brackets, totaling a saving to income taxpayers of $227 million. The rest of the billion dollars in carbon tax-funded cuts come from boutiaue and industry tax cuts—which very few British Columbians filling up their gas tanks can access. Are you claiming the digital media tax credit? Or the industrial property tax credit?

A savvy government would kill the carbon tax and all of the other credits, but find a way to keep that $227 million in income tax cuts—that’s about one-half of one per cent of the B.C. Budget. Cutting the carbon tax would save some admin dollars. Cut the Pacific Carbon Trust and save another $14 million—put that toward keeping the income tax cut. It’s doable, even within a balanced budget framework.

Falcon says, “If we eliminate the carbon tax of course you would have to see a double digit increase in both small business taxes and personal income taxes.” Again, the personal income tax cut was 5 per cent. So no double digit increase there. And I would argue most of us (certainly those outside of transit-heavy areas) would be further ahead by killing the carbon tax.

Falcon says, “[The] New York Times, the Economist magazine, and others have applauded British Columbia for coming forward with a common sense approach.” It has been popular with out-of-province media, but no other jurisdiction in North America has followed suit. We are at a competitive disadvantage right off the top—one that will worsen for attracting businesses when the HST disappears next year. We are starting a race two steps behind. If it’s such a great tax, why has no other state, province, city or country in North America brought it in?

Today’s Vancouver Province has a killer editorial on the carbon tax. Premier Clark, Minister Falcon and the rest of the BC Liberals would do well to consider it:

Premier Christy Clark and her gang should read the public responses to a small story theprovince.com ran on B.C.’s Carbon Tax. 

With one exception, the public — voters, for the most part — agreed with the Canadian Taxpayers Federation that the tax should be eliminated because it is doing nothing to help the environment and is simply ripping off taxpayers. 

According to the federation, Victoria took in $1.2 billion last year from the supposedly “revenue-neutral” tax while only cutting income tax by $228 million. As others have stated, the tax is regressive: regular people who must use their vehicles due to their jobs or lack of alternatives must pay and can’t, as companies do, write off the tax as a cost of business. 

And the tax isn’t reducing fuel usage, despite what you’ll hear from environmental organizations who don’t apparently care about saddling taxpayers with more costs. 

B.C. gas consumption rose to 4.74 billion litres last year from 4.61 billion in 2008, when the tax began, despite a recession. Diesel sales rose to 2.22 billion litres from 1.71 billion.

If Clark cares about getting re-elected, she should scrap the ineffective and much reviled Carbon Tax, which has helped to make Metro Vancouver gasoline the highest-taxed fuel in North America. While she’s at it, she should bag that useless and tax-sucking Pacific Carbon Trust, too.


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Franco Terrazzano
Federal Director at
Canadian Taxpayers
Federation

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