Ont. Tory govt could get carbon cash tax despite opposition, experts say

“Whether they fight the federal government or not, that carbon tax is going to happen,” said Trevor Tombe, an economist with the University of Calgary who has been watching the heated race closely.

“Then the feds will return the money to the Ontario government. So basically all of the budgeting that’s currently in the People’s Guarantee (party platform) can be maintained.”

Tombe suggested the leadership candidates are publicly railing against the carbon tax while fully aware they could likely reap its rewards. A court challenge over the matter, he added, is unrealistic.

“The federal government has jurisdiction to implement these kind of measures as it sees fit,” he said. “It has near-unlimited taxing power.”

A spokeswoman for Environment Minister Catherine McKenna said the federal government has not decided how it will pass the proceeds of a carbon tax back to the provinces, but acknowledged it had options.

“The draft legislation gives the federal government the flexibility to return the revenues directly to people and companies in the province,” Julia Kilpatrick said.

Allan Maslove, a public policy professor at Carleton University, said it’s unlikely the federal government will go around a provincial Tory government even if it openly challenges the carbon tax.

“I think the political fallout from that would be too hard for them to take,” he said.

Instead, Maslove said, Ottawa could create a system under which provinces that aren’t willing carbon-pricing participants have to deal with less desirable conditions — and potentially less money — than if they had their own carbon tax or cap-and-trade regime.

Jean-Thomas Bernard, a University of Ottawa economics professor, said it would be “awkward” for a Tory government to accept carbon-tax cash from Ottawa while also being opposed to the measure.

Ontario’s Liberals, who have raised nearly $2.5 billion since introducing their cap-and-trade system last year, have attacked the Tories for not coming clean on how they would pay for their campaign promises without a carbon tax.

“That’s a massive hole in their plan,” said Liberal campaign co-chair Deb Matthews. “I think if they were being truthful with the people of the province they would acknowledge that that is a hole and it’s not good enough to say they’d find it through efficiencies.”

Shawn Jeffords, The Canadian Press

by Canadian Press

Ont. Tory govt could get carbon cash tax despite opposition, experts say

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