Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

Prime Minister Justin Trudeau arrives for the first day of a Liberal cabinet retreat in Ottawa on Sept. 14, 2020.

Adrian Wyld/The Canadian Press

This tax is not like the others.

On Friday, the Trudeau government presented its redoubled plan to meet Canada’s long-term climate goals. Its centrepiece is a steadily rising carbon tax.

The current tax is $30 a tonne of carbon, which works out to roughly seven cents of tax on a litre of gasoline. It had been set to rise to $50 a tonne in 2022, which critics rightly pointed out was likely not high enough to do much to quell the appetite for fossil fuels.

Story continues below advertisement

The government is now pledging to push it to $170 a tonne by 2030 – nearly 40 cents a litre on gas.

Ottawa has long overpromised and underdelivered on climate change, whether led by Jean Chrétien, Stephen Harper or Justin Trudeau. Before Friday, Canada was going to fall well short of its Paris Agreement targets for 2030, but this new plan, if carried through, could change that.

Instead of relying on government micromanagement of the economy and business, the Liberals’ carbon plan is built around a clear and simple market lever.

Yes, there is lots of pocket change for politically popular green subsidies – dollars here for eco-friendly home renovations, dollars there for buyers of electric cars. Those details took up most of Friday’s announcement. It’s as if the Trudeau government was trying to bury its own lead.

The big news is that carbon pricing – a decade of annual increases, worth tens of billions of dollars a year – is now the government’s core environmental strategy. (That is, of course, as long as the Supreme Court of Canada rules in its pending decision that the power to levy such a tax is within the federal government’s constitutional purview.)

In the history of politics, promising to radically increase a tax on almost everyone has rarely been a winning idea. The Liberals may be taking a big risk. But this tax is like no other.

The plan is to return a lot of the money to taxpayers. That’s what the feds already do in provinces, such as Alberta and Ontario, that declined to impose their own carbon tax. By 2030, a family of four in Ontario can expect to receive $2,000 a year in refunds. The same family in Alberta could get $3,200.

Story continues below advertisement

The carbon tax leaves it to households and businesses to figure out how to best reduce their own emissions – and avoid the tax.

Take public transit? Own a fuel-efficient, or electric, car?

Millions of Canadians could end up getting back more in rebates than they fork over in carbon taxes.

This tax is also like no other because its goal is to change behaviour, not to raise revenues. The aim is for people to do such a good job of reducing emissions, and thereby avoiding the tax, that revenues eventually spiral to zero. The carbon tax’s goal is its own obsolescence.

To change people’s choices, the tax has to be high enough to matter. Today’s carbon tax of seven cents a litre on gas is not nothing, but it’s not much. In 2025, it will be 21 cents a litre, and 38 cents in 2030. That’s a way different story.

Conservatives of late have reviled the carbon tax. Opposition to it has become orthodoxy on the right – even though, as a market-based solution, it started life as a conservative idea.

Story continues below advertisement

Among economists, putting a price on carbon is generally seen as the most efficient way to push people and businesses to use less carbon. It works because, as anyone who has ever been shopping knows, prices matter.

In taking the 2030 climate goals seriously, and choosing carbon pricing to achieve them, Ottawa is making the right move, rather than the easy move. Critics will have to offer an alternative, and explain why it is better than what’s now on the table.

The urgency to act is real.

Five years ago, the Paris Agreement aimed to keep global warming to 1.5 degrees.

Two years ago, the United Nations said that the goal of 1.5 degrees “would require rapid, far-reaching and unprecedented changes in all aspects of society.”

Yet just last week the UN, in its “emissions gap” report, warned the world is on track for a calamitous three degrees or more of climate heating by the end of the century.

Story continues below advertisement

The Trudeau government’s new plan has ambition that is up to the scale of the challenge. The necessity of a serious carbon tax has long been clear. It is now poised to become a reality.

Keep your Opinions sharp and informed. Get the Opinion newsletter. Sign up today.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies