Smith says courts should 'frown' at Québec’s 'special' carbon tax deal

'It's become quite clear that the price the federal government has set is not the same in every province,' says UCP leader Danielle Smith. 'Québec is going to have a much lower carbon tax price than Alberta.'

  • By Alex Dhaliwal
  • May 29, 2023
  • News Analysis
Smith says courts should 'frown' at Québec’s 'special' carbon tax deal
THE CANADIAN PRESS/Jeff McIntosh
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UCP leader Danielle Smith informed the media the Supreme Court of Canada is "unlikely" to hear another legal challenge of the federal carbon tax.

When asked if she would consider it, Smith said: "I have to seek guidance on that."

"My initial guidance was that the Supreme Court is unlikely to hear another case on a similar matter so close after rendering a judgment," she confirmed. In March 2021, the Supreme Court upheld the federal carbon tax in a 6-3 decision despite legal challenges from Alberta, Saskatchewan and Ontario.

In a CBC interview last October, Smith opened the possibility of the province re-litigating the Supreme Court on the federal carbon tax. She told the state broadcaster it could be in the cards if presented with "new information," according to legal advice she received.

The UCP leader told reporters Friday that they need to look at some things.

"We have new information. We have a war in Ukraine. We have a global world increase in prices. We have global instability. We have an affordability crisis," she said, adding a legal challenge of the carbon tax is one way to address affordability and inflation.

Smith wrote to Prime Minister Justin Trudeau last November to highlight her concerns about another carbon tax hike. She demanded Ottawa cancel its planned and gradual tripling of the carbon tax as it contributed to higher inflation and borrowing costs for Albertan households. 

"It's to make life more painful for the poor and the powerless, and with that tax set to go up again in the middle of winter, when inflation is eating more and more into your hard-earned dollars," said the UCP leader. In March, the Bank of Canada Governor, Tiff Macklem, confirmed the carbon tax added 0.4% to inflation.

"We do not want to see the price of everything go up, especially for our seniors on fixed incomes during the winter months," continued Smith.

On May 4, Rebel News asked UCP candidate Brian Jean if further conversations had occurred. He pivoted to explain how expensive the carbon tax is for Albertans.

"The UCP is always going to stand up for Albertans, and the carbon tax is something that puts a tax on everything and makes life more expensive," said Jean.

According to the Parliamentary Budget Officer (PBO), the typical Albertan household will lose $2,773 annually from the carbon tax in 2030. Its upper quintile will pay $7,402 after accounting for the carbon rebate that year — the highest cost nationwide.

The carbon tax currently costs Albertans 14.4 cents per litre of gas, up from 8.8 cents in 2021. That is expected to rise to 37.6 cents in 2030. Residents will pay 67.8 cents in fuel taxes per litre of gas at that time.

However, Québec only pays 9 cents per litre of gas as of April 1. By 2030, it will rise to 22.5 cents per litre of gas by 2030.

"It's become quite clear that the price the federal government has set is not the same in every province," added Smith. "Québec is going to have a much lower carbon tax price than Alberta, and I suppose if the federal government were going to interfere in this matter, the courts would frown on differential pricing."

The UCP leader added these decisions should be made at the local level and that they oppose a consumer carbon tax "for a good reason." She cited that the carbon tax will continue to increase electricity and home heating costs.

Despite Ottawa committing to a carbon tax "at a similar level of stringency" across the country, Québec will pay $97 per tonne in 2030. In contrast, Alberta and the rest of Canada will incur $170 per tonne of emissions.

On December 9, the UCP leader told reporters she would look at using the Alberta Sovereignty Act to investigate this discrepancy. The party has yet to confirm if or when that motion would be tabled.

"When you consider how everybody else is dealing with the carbon tax, this will hurt Albertans harder than anybody else in Canada, except for maybe Saskatchewan," added Jean. "We need to make sure Albertans realize this before the election."

On November 29, Smith announced the UCP would suspend the fuel tax from January to June 2023. She claimed it is "designed by the wealthy and well-connected" while not readily impacting their household finances as it does everyone else. 

According to PBO Yves Giroux, the carbon tax "is a progressive tax." He said the top 60% of households pay more tax than they receive in rebates, while the bottom 40% receive more refunds than they pay — switching to only the bottom 20% in 2024/25.

"If you do the average, yeah, it's true, it's going to cost more money to people, but the people who are paying are the richest among us, which is exactly how the system was designed," federal Environment Minister Steven Guilbeault told CTV last month.

"The rich pay more for their carbon consumption and pollution, and we're supporting, through the transition, middle-class Canadians and low-income Canadians, and that's exactly what we're doing."

On May 11, Smith and the Alberta UCP extended the fuel tax suspension until the end of 2023 in a pledge to make "life more affordable" for Albertans.

Rebel asked if the party would consider extending it further. Smith said, "We want to gauge it based on our oil and gas prices and revenues."

Canada Quebec News Analysis Danielle Smith Expose The Reset Alberta Decides
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