Canadian industries support new ‘carbon tax’

Conservatives slam NDP carbon pricing scheme, but industry agrees plan is needed

The carbon pricing scheme proposed by the federal NDP aims to cap carbon emissions such as those from this coal-fired power plant in Nova Scotia

Federal NDP leader Thomas Mulcair’s proposed “carbon tax” would raise the price of everything and “cripple Canadian businesses and kill Canadian jobs,” a new Conservative Party radio ad warns.

But given that the NDP proposal is not a tax but a cap-and-trade carbon pricing system similar to the one the Conservatives promised in 2008, the ads are misleading and hypocritical, according to carbon tax supporters that include several Canadian business and industry groups.

“Stephen Harper’s Conservatives once proposed an emissions cap as an alternative to carbon taxes,” said Mark Jaccard, professor of environmental economics at Simon Fraser University. “They now say Mulcair’s proposal for an emissions cap is a carbon tax.”

According to a survey by the Ottawa-based research organization Sustainable Prosperity, Canada’s major industry associations – including the Mining Association of Canada and Canadian Association of Petroleum Producers (CAPP) – are in favour of putting a price on carbon as a way of meeting Canada’s commitments to reducing greenhouse gases. Some favour a carbon tax; others don’t care whether the carbon pricing is through a tax or cap-and-trade, as long as it’s uniform.

“We want harmony amongst all the jurisdictions,” said Geoffrey Morrison, CAPP’s manager for B.C. operations. “What doesn’t work is when you have one doing cap-and-trade, and one doing emissions pricing and one doing something different. Whatever we do, let’s do it in harmony.”

Though politically harder to sell, carbon taxes – like the one B.C. has had since 2008 – are considered by many economists and industry leaders to be the simplest, most effective mechanism for curbing carbon emissions.

“Carbon tax wins hands-down,” said Tom Pedersen, director of the Pacific Institute for Climate Solutions. “It’s clean, it’s simple, it doesn’t require auction systems, it doesn’t require companies having to build all the time on transferable credits.”

The Conservatives warn that the NDP’s carbon pricing scheme would cost $20 billion. Because party headquarters did not return calls from Business in Vancouver, it’s not clear how the Conservatives arrived at that calculation. 

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