Carbon tax fueling concerns from city

By Wolf Depner - Penticton Western News - May 09, 2008

City officials are wondering whether the carbon tax will actually be effective.

Coun. Randy Manuel questions why the province will charge the carbon tax on diesel-powered transit buses.

He predicts this will make local transit less affordable. And with transit less affordable, how will this encourage local residents to use transit in making the city more “green” and reduce their carbon foot-prints, he asked.

Finance Minister Carole Taylor introduced the Carbon Tax Act last week. The tax will add 2.4 cents to a litre of gasoline in the first year, rising to 7.2 cents a litre by 2012. Diesel buyers will initially pay an extra 2.8 cents, reflecting the higher carbon content of a litre of diesel.

The act also obliges the government to return the same amount of money raised by the tax through business and personal income tax cuts.

Municipalities and school districts, however, do not get any tax breaks on their fuel purchases and this has led to questions whether the tax will actually encourage green behaviour.

Taylor said she has heard from a parade of organizations that wanted exemptions.

“If you really said, well, ‘we’ll make an exception for the north, and we’ll make exception for UBCM and their municipalities, and we’ll make an exception for the hospitals and school boards and the truckers and the taxi drivers, and those who are involved in the agricultural industry, and realtors,’ which was the last one, then you begin to see that the whole idea of taxing carbon-emitting fuels falls apart,” she said.

“I could think, as finance minister, of a thousand excuses or reasons why we don’t have to move forward, or we don’t have to move forward at this time, but to do that would be to duck our real responsibility to future generations.”

The legislation calls for a two per cent cut in the bottom two personal income tax rates for 2008, and the general corporate rate goes from 12 per cent to 11 effective July 1. Low-income people qualify for a “climate action credit” of $100 per adult and $30 per child, but there are no firm commitments beyond 2009.

The government is also mailing out $100 “climate action rebate” cheques to every man, woman and child in B.C. in June, with encouragement to spend it on energy-saving strategies.

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Carbon tax fueling concerns from city

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