Province appealing carbon tax exemption on heating oil
By Al Beeber - Lethbridge Herald on October 30, 2024.
LETHBRIDGE HERALDabeeber@lethbridgeherald.com
The provincial government is challenging the constitutionality and legality of Canada’s heating oil carbon tax exemption.
The province said Tuesday it filed an application at the federal court on Tuesday seeking a judicial review of the exemption, asking the court to declare it unconstitutional as well as unlawful.
The province believes the federal government is practising a double standard by exempting heating oil from the tax while imposing it on Alberta where less than one per cent of homes use heating oil as fuel. Heating oil is primarily used in Atlantic Canada.
“Over the last year, the federal government has refused multiple requests to grant a similar carve-out on other heating methods from Alberta and others across the country who are also facing rising costs of living,” said the province in a release.
“Last year, Ottawa decided Canadians in the East deserved a three-year break from paying the carbon tax on their home heating costs. While we’re happy for these Canadians, Alberta, Saskatchewan and other provinces who heat their homes with natural gas have been deliberately excluded from these savings. Albertans simply cannot stand by for another winter while the federal government picks and chooses who their carbon tax applies to. Since they won’t play fair, we’re going to take the federal government back to court,” said Premier Danielle Smith.
The Alberta government is opposing the tax exemption “as the federal government is no longer creating minimum national standards that apply evenly across the country, and is instead creating a regime that favours one region and fuel type over others,” says a statement by the government.
Forty per cent of households in Prince Edward Island are heated by oil, slightly higher than the 32 per cent in Nova Scotia. In Newfoundland and Labrador, 18 per cent of homes are heated by oil. The figure is seven per cent in New Brunswick.
“This exemption is not only unfair to the vast majority of Canadians, but it is also unlawful as the federal government does not have the authority to make special exemptions for certain parts of the country under the Greenhouse Gas Pollution Pricing Act. The federal government isn’t even following its own laws now. Someone needs to hold them accountable, and Alberta is stepping up to do just that,” according to Minister of Justice and Attorney General Mickey Amery.
The Alberta government says the carbon tax by the year 2030 will cost Canadians $25 billion a year while lowering the gross domestic product by $9 billion.
The province says Albertans since April 1 have been paying about 35 cents in federal taxes on every litre of fuel, including the carbon tax, federal excise tax and GST.
The Alberta move to fight the exemption is being supported by the Canadian Tax Federation whose federal director Franco Terrazzano said in a statement that “the carbon tax is making the necessities of life in Alberta more expensive and that’s why Smith is right to take Prime Minister Justin Trudeau’s carbon tax back to court. Last time the carbon tax fight went to the Supreme Court, the federal government argued it needed a national carbon tax to deal with a national problem. But then it undercut its own argument for a national carbon tax by making an exception for furnace oil, which clearly favours Atlantic Canada.
“Trudeau torpedoed his own constitutional argument for imposing a carbon tax so it’s time to challenge it in court again,” he said.
Alberta’s NDP, however, opposes the fight. Party leader Naheed Nenshi said in his own statement that “
“It’s very clear that the premier doesn’t think that Pierre Poilievre is going to win the next federal election if she is tying us up in court for so many years on yet another unwinnable court case. I’m no lawyer, but the Supreme Court has ruled that the carbon tax is constitutional. Certainly, the federal government really dropped the ball in creating the carve out for home heating oil. I don’t know why they thought that was a good idea. They absolutely undermined the consumer carbon tax in a very big way.
“But again, instead of making a deal with the federal government, instead of talking about an exemption for natural gas or even more rebate money going to people in Alberta who want to get off home heating oil, the UCP government just chooses to fight,” Nenshi stated.
17-16
NO to Axe the Tax!
YES to Tax the Rich!
Great post! The debate around the carbon tax exemption on heating oil raises important questions about fairness and national standards. Alberta’s move to challenge this in court highlights the growing frustration with regional disparities. While exemptions like this may help some Canadians, it’s crucial to ensure the policy applies equitably across the country. It’s interesting to see both sides of the argument, and I appreciate the detailed breakdown.