Carbon tax rebates should continue, even if Sask. stops remitting money, minister says
Liam O'Connor | CBC News | Posted: January 4, 2024 10:11 PM | Last Updated: January 4
It's a matter of fairness, Dustin Duncan says
It's only fair that federal rebates should not be reduced if Saskatchewan stops remitting carbon tax revenues to Ottawa, the minister responsible for SaskEnergy says.
Dustin Duncan also says that if the province does ultimately decide to remit carbon tax revenue to the federal government, it will pay for it with either the general revenue fund, SaskEnergy earnings or both.
But no final decision on that has been made yet, Duncan said during an interview on CBC's Morning Edition on Thursday.
"All of this could be solved if the prime minister just did the right thing and provide that fairness to all Canadians, including people in Saskatchewan," he said.
Earlier in the week, Duncan said the Saskatchewan government will make its decision in February on whether to remit the heating gas carbon taxes to Ottawa.
However, Saskatchewan announced last October it would stop collecting the carbon tax on natural gas starting on Jan.1 because of the federal government's decision to pause the tax on home heating oil, which mostly helps Atlantic provinces.
When asked why the provincial government doesn't remove other taxes such as the provincial sales tax, Duncan replied it's about "the principle of fairness" when it comes to the carbon tax.
"We're not asking for any special treatment, we just want to be treated the way that the prime minister has treated one region of the country," Duncan said.
If Saskatchewan residents are going to see a reduced rebate because of the plan of the provincial government, then we have another issue of fairness. - SaskEnergy Minister Dustin Duncan
The minister brought up the point of "fairness" again when talking about rebates, saying the federal government didn't clarify whether Atlantic provinces will get rebates or whether they will be reduced.
"If Saskatchewan residents are going to see a reduced rebate because of the plan of the provincial government, then we have another issue of fairness," Duncan said.
"It doesn't appear that Canadians and Atlantic Canada are going to see a reduced rebate because of what the prime minister has done."
He said the provincial government's plan shouldn't have an effect on rebates.
Trevor Tombe, a professor of economics at the University of Calgary, said Duncan misunderstands the federal system.
"The rebates to not just Atlantic Canada but everywhere will be affected by the exclusion of home heating oil from the backstop system," Tombe said. "It'll predominantly affect Atlantic Canada."
The distinction between Atlantic Canada and Saskatchewan, according to Tombe, is that Saskatchewan is planning on withholding the carbon tax, which would be illegal.
"The federal government naturally would have expectation of receiving the revenue that is owed," Tombe said. "Therefore rebates might not actually be affected even if there is a delay in the actual cash remittance."
Because the money is legally owed to the federal government, Tombe said, they'll likely book it as revenue, even if the actual cash is not received on time.
However, he said, "without question" rebates will be reduced because of the Atlantic exemption.