Price of home heating oil in N.L. will skyrocket with federal carbon tax, says finance minister
Province removing its 11-cent carbon tax on gasoline, but it will be replaced by a 14-cent federal tax
Newfoundland and Labrador is repealing legislation and will no longer collect the provincial carbon tax as of July 1.
The announcement was made in a press release Wednesday in which the provincial government said wholesalers and retailers of gas and home heating oil should stop making that charge.
The release comes just over a week before the federal carbon tax backstop will be imposed on Newfoundland and Labrador. The province has been vocal in its disapproval of the federal government's approach.
The backstop would eliminate carbon tax exemptions on home heating fuel, municipal operations and intraprovincial flight and would automatically raise the price of fuels across the province.
Finance Minister Siobhan Coady said that will translate to a three-cent per litre increase in the price of motor fuels and a 17-cent per litre increase for the over 40,000 homeowners who heat their homes with oil.
"The government of Newfoundland and Labrador has asked the federal government — pleaded with the federal government — not to do this. And they have said no, they're pressing forward," Coady said Friday.
"It's going to cause burdens. It's going to cause challenges for the people of the province."
So while the provincial government is removing its 11-cent carbon tax on gasoline, it's getting replaced by a 14-cent tax by the federal government..
The federal tax on carbon is a policy that makes fossil fuels progressively more expensive to encourage Canadians to choose greener alternatives. Coady said the changes will increase the price of home heating oil by 45 cents per litre by 2030.
Ninety per cent of the federal fuel tax will go back to consumers in the form of rebates, the federal government announced in November. The rebates will give a family of four over $1,300 annually, along with a 10 per cent rebate bump for people who live in small and rural communities.
Newfoundland and Labrador has avoided being lumped into the federal carbon tax system for four years by getting exemptions placed on the tax for home heating oil — which Coady called a "made in Newfoundland and Labrador solution."
Now that the province will no longer be collecting tax, she said, it will also lose out on revenues — $113 million.
David Brazil, interim leader of the PC Party, said the imposed tax will be too much for some residents to handle.
"We could be up to, you know, $2 a litre [for gas] again in the very near future. Imagine the impact that's going to have on the cost of goods and services," Brazil said Wednesday, adding the changes will especially impact those on fixed incomes.
"This is going to be devastating to the people of Newfoundland and Labrador," he said. "The costs of goods and services obviously [will] dramatically increase."
Brazil said the province needs to sit down with Ottawa — which he added he would also be willing to do in solidarity with Premier Andrew Furey — to find a different strategy that works best for Newfoundland and Labrador and its residents.
"Newfoundland and Labrador is not a polluter. The people here shouldn't be punished for it," Brazil said.
"Let's sit down, come up with something that best works for all involved, and still does our part to eliminate or hinder the emissions that are coming out from our carbon industries in Newfoundland and Labrador, which we have very few.… Don't be ramming a tax down people's throats that actually is not going to do anything, only hurt."
Atlantic Canada's premiers issued a press release Friday asking for a meeting with the federal government, saying the federal fuel charges will disproportionately impact the region.
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With files from Terry Roberts
