Braid: Trudeau's secret weapon; Axe the Tax means Ruin the Rebate

Trudeau faces fierce opposition to the carbon tax, but his secret weapon is the growing carbon tax rebate. If the tax goes so does the cash

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Albertans receive far higher carbon tax rebates from Ottawa than any other Canadians.

A family of four will get $1,800 annually, up from $1,544 last year.

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In Ontario, this year’s benefit is $1,120.

Per capita, Albertans burn more fuel and emit more carbon than other Canadians.

That means higher levels of carbon tax – and more money back from what’s now called the Canada Carbon Rebate.

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Weirdly, Albertans are rewarded for doing exactly what Ottawa wants to prevent, emitting carbon.

But how many Alberta families would be thrilled to lose those quarterly political kickbacks if the tax is scrapped entirely?

Not many, probably. Rebates are the Liberals’ covert weapon in the next election.

Under the Liberal plan, rebates will keep climbing until the carbon price hits $170 per tonne in 2030.

By that time the Alberta rebate could be more than $4,000 per family. That’s a lot of cash to forsake.

Prime Minister Justin Trudeau won’t back away from the April 1 carbon tax increase, even though it’s opposed by seven premiers and 70 per cent of Canadians.

The PM doesn’t see the tax as a demerit. In fact, he behaves as if it’s his most potent weapon.

Prime Minister Justin Trudeau meets with Alberta Premier Danielle Smith in Calgary on Wednesday, March 13, 2024. Todd Korol/The Canadian Press

Trudeau suggested in Alberta this week that his noble duty is to raise the tax so he can send us more cash.

There’s little logic to this argument. Historically, however, voters have shown that money is a far more powerful motivator than common sense.

Kill the tax, lose the cash. Simple as that.

The Liberals may look crushed right now, but they are masters at rescuing themselves with such long-term calculation, or cynicism.

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After Alberta, Saskatchewan gets the highest rebates – or did, until the province stopped collecting and paying tax on natural gas for home heating.

The Saskatchewan case – as well as the home heating oil exemption – shows what happens when the tax is successfully opposed or obligingly reduced.

The Saskatchewan rebate for a family of four is supposed to be $1,504 this year. Last year, it was $1,360.

But the rebate will now diminish because of the tax revolt, the feds say.

Saskatchewan’s move is supposed to save the average family $400 annually in carbon tax paid.

Trimmed federal rebates could easily eat up that benefit.

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The Liberals’ controversial suspension of tax on home heating oil carries the same warning.

Because of tax now unpaid, rebates will be significantly lower in Nova Scotia, Prince Edward Island and Newfoundland and Labrador.

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In the latter, for instance, the rebate will drop from $1,312 to $1,192 for a family of four.

P.E.I. will see a decline from $992 to $880.

Small change, you might say, but the caution is clear – if the carbon tax is abolished, every penny goes away.

People in the Atlantic provinces, especially those who don’t use home heating oil, could start to see the carve-out as a penalty rather than a benefit.

The federal Conservatives are drawing huge support for their Axe the Tax campaign. They haven’t yet faced the inevitable Liberal charge that they’d also Ruin the Rebate.

Leader Pierre Poilievre points out that the tax trickles into higher prices for many items, including food.

Conservative Leader Pierre Poilievre Photo by Justin Tang/The Canadian Press/File

Standing beside truck cabs in Winnipeg, he said “Everything transported in these trucks becomes more expensive because of the Trudeau tax on carbon and on diesel.”

He’s not wrong there, but the cost of the tax isn’t nearly as visible as the rebate for paying it.

For instance, the April 1 carbon tax hike will raise gasoline prices about three cents per litre.

On the rebate side, that higher tax will bring Alberta families $256 more per year.

You’d have to buy 8,533 litres of gasoline to pay $256 in extra carbon tax – 100 to 150 fill-ups, depending on the vehicle.

Is there any real connection between the carbon tax and the rebates? That’s not clear, or even likely.

But there’s no doubt about the latent political power of Liberal tax math.

Don Braid’s column appears regularly in the Calgary Herald

X: @DonBraid

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