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BC's Consumer-based Carbon Tax
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Starting July 1, B.C. will levy an extra tax on all carbon-emitting fuels consumed in the province. The rate starts at $10 a tonne, which works out to about 2.4¢ a litre at the pump, or 2.8¢ a litre for diesel and home heating oil. The rate will rise by $5 a tonne a year for the next four years, reaching $30 a tonne, or 7.2¢ a litre of gasoline, by 2012.
No one likes a new tax, but business groups, including the B.C. Chamber of Commerce, have cautiously endorsed it. Here’s why. It’s a flat tax on consumption: the more carbon you consume, the more it costs you. By attaching a price to carbon, the province is encouraging people to reduce their emissions. Yet by introducing the tax gradually, the government is also giving a four-year window for people to adjust to the new costs.
What’s more, unlike an income or payroll tax, a carbon-usage tax likely won’t have a regressive impact on growth or hiring. And, the government claims, it will be revenue-neutral. B.C. has pledged to return every dollar raised to businesses and individuals, in the form of lower taxes and an annual “climate action credit.”
The B.C. government expects the tax to raise $1.8 billion over the next three years. As a result, the province on July 1 will reduce the general corporate income tax rate to 11%, from 12%. Small business will see their tax bill reduced to 3.5%, and personal income taxes will fall by 5% on the first $70,000 of income. The tax cuts amount to $1.45 billion; the remaining $395 million will be mailed out in $100 cheques to every adult in the province.
The policy is unlikely to actually reduce emissions, at least initially. But once the tax reaches $30 a tonne, some reckon it will reduce annual emissions by three million tonnes.
It is unfortunate that yet another province has decided to tackle climate change alone, rather than work at creating a Canada-wide consensus. But that’s to be expected in today’s political climate. With 11 years of dithering (and only tonnes of hot air to show for it), that one jurisdiction has finally shown leadership is worth acknowledging.
Details & Highlights of the British Columbia Budget:
Carbon Tax:
-Beginning July 1, 2008, British Columbia will begin phasing in a carbon tax on all fossil fuels including gasoline, diesel, natural gas, coal, propane and home heating fuel.
-The rate starts at $10 per tonne of carbon-equivalent emissions and will rise by $5 per year for the next four years.
-As of July 1, there will be a 2.41-cent increase per litre in gasoline. By 2012, it will be 7.24 cents per litre.
-For diesel and home heating oil, it works out to 2.2 cents per litre, rising to 8.27 cents by 2012.
-The tax will generate about $1.85 billion over three years.
-Two thirds of the money raised in the first year will come from business.
-The tax is to be revenue neutral and none of the money raised through the carbon tax will go toward program spending.
-Legislation will require a plan to be tabled in the legislature each year showing how the carbon-tax revenue will be returned to businesses and individuals.
Tax Cuts:
-Each adult and child in British Columbia will get a $100 rebate - a so-called Climate Action Dividend - in June aimed at helping people adopt greener lifestyles.
-Lower-income British Columbians will be eligible for a $100 payment per adult and a $30 payment per child as part of a Climate Action Credit. The money will be paid quarterly.
-The bottom two personal income tax rates will be reduced for all British Columbians, resulting in a tax cut of two per cent in 2008 and 5 per cent in 2009 on the first $70,000 in earnings.
-Effective July 1, 2008, the general corporate income tax rate will be reduced to 11 per cent from 12 per cent. By 2011, it will be reduced to 10 per cent.
-Effective July 1, 2008, the small business tax rate will be reduced to 3.5 per cent from 4.5 per cent, with further reductions planned to 2.5 per cent by 2011.
Spending:
-Health spending increases by $2.9 billion over three years.
-$144 million over three years in extra money will go to K-12 education.
-$104 million of extra funding will go to reduce homelessness over four years.
-An additional $78 million over four years to allow emergency shelters to stay open 24 hours a day.
Overall:
-Total government revenue is forecast at $38.5 billion in 2008-2009
-Total government expense is forecast at $37.7 billion in 2008-2009
-The budget includes a $375 million contingency fund for emergencies and a $750 forecast allowance.
-The surplus is projected to be $50 million.
-The surplus for the last budget year was $2 billion.
Public Comments on the B.C. Liberal Government's Latest Budget:
"This is an important turning point for British Columbia. We think for Canada." - Finance Minister Carole Taylor on introducing what her officials say is the most unique carbon tax in Canada.
"We congratulate British Columbia on taking this visionary step. This marks a real turning point for British Columbia and puts the province at the forefront of North American action on climate change." - Ian Bruce, a climate change specialist with the David Suzuki Foundation.
"These cuts in school tax will assist B.C.'s major industries and largest employers adjust to challenging economic times, while the elimination of the capital tax will go a long way towards ensuring B.C. will be well placed to become the financial gateway to Asian markets." - B.C. Chamber of Commerce.
http://www.canadianbusiness.com/after_hours/opinions/article.jsp?content=20080226_198720_198720
Additional News Coverage:
http://cnews.canoe.ca/CNEWS/Science/2008/02/19/4859806-cp.html
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EARTH HOUR IS JUST THE BEGINNING
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TORONTO, ONTARIO--(Marketwire - April 17, 2008) - A new poll commissioned by WWF-Canada shows that almost half of Canada's adult population participated in WWF's Earth Hour event on March 29, creating an unprecedented call to action on climate change. Poll results also show that 84 per cent of Canadians say the federal government should be doing more to fight climate change.
The global results of participation in Earth Hour show that Canada led the world in their commitment to personal action. Nationally, more than 150 cities and municipalities turned off the lights - the most in any country. Canada also led the world in global sign-ups with more than 130,000 people registering online at www.earthhour.org, which was just a fraction of the actual participation. Across the country 49 per cent of Canadians say they participated in Earth Hour, and in the Greater Toronto Area (GTA) participation rose to 85 per cent.
The poll results also show that Canadian concern for climate change extends far beyond participating in Earth Hour. In the GTA, most people participated in Earth Hour to show support for action on climate change (79 per cent) and to express a commitment to take personal action (67 per cent). Seventy one per cent of those who participated say they are now more likely to reduce power consumption at home by at least 30 per cent to help fight climate change after Earth Hour.
"On Earth Hour, Canadians showed their frustration with inaction on climate change by turning off millions of lights and appliances. WWF-Canada has received letters, e-mails and now polling results from across the country showing that people are starting to walk the walk to a low-carbon lifestyle. Canadians are taking action both because they care deeply about the planet, and as a tangible message to governments and business to pick up the dismal pace on greenhouse gas reduction." says Julia Langer, Director, Global Threats, WWF-Canada.
Canadians also felt WWF's Earth Hour was effective in calling for global action: 74 per cent of Canadians say that Earth Hour is making a difference in raising global awareness of climate change and 60 per cent believe that Earth Hour is making a difference by putting pressure on world leaders to improve the environment.
The level of participation in, and awareness of, Earth Hour was highest in Toronto, where WWF-Canada promoted Earth Hour most heavily. In the GTA alone, there was a 98 per cent unaided awareness of Earth Hour, compared with 81 per cent nationally.
To help people make every hour Earth Hour, WWF-Canada launched a program called The Good Life at
wwf.ca. The Good Life is designed to help Canadians take personal action to help fight climate change, and see the positive impact of their actions by tallying the total greenhouse gas emissions saved personally, provincially and nationally. Since Earth Hour, registration on the site has doubled.
The WWF network has already started planning for Earth Hour 2009. In the GTA, 87 per cent of those polled say they are likely to participate again, and spontaneous ideas and plans for weekly and monthly Earth Hour events have sprung up on social networking sites and are happening in homes and businesses across the country.
Meanwhile, to redress rising rather than declining emissions, WWF continues to press for greenhouse gas reduction policies and practical action in Canada and around the world, with a priority on energy efficiency requirements for buildings, appliances and cars; legally-binding caps on industrial pollution (instead of the intensity-based approach proposed by the federal government); and a new UN agreement that will ensure all countries collaborate in cutting global emissions in half.
The National Omnibus Poll was conducted by Angus Reid Strategies on behalf of WWF-Canada from March 31 to April 1, 2008, using an online survey among a randomly selected, representative sample of 1,005 adult Canadians. The GTA "Deep-Dive" Survey was also conducted online, among a sample of 1,002 residents of the Greater Toronto Area from March 31 to April 3, 2008. The margin of error for the total sample of both surveys is +/- 3.1%, 19 times out of 20. In both cases, the results have been statistically weighted according to Statistics Canada's most current education, age, gender and region Census data to ensure a representative sample of the entire adult population of the target region (i.e., Canada and the Greater Toronto Area). Discrepancies in or between totals are due to rounding. These surveys were conducted using the Angus Reid Forum online panel, which is recruited via an industry-leading process that incorporates a randomized, widespread invitation approach and a triple opt-in screening procedure.
Notes:
1. Photos and backgrounders can be found at http://del.icio.us/wwfca
2. More results are available at www.wwf.ca/earthhour
