Premier Eby Announces Reversal of Consumer Carbon Tax

Photo Credit: Dawn McDonald/Unsplash

BC Premier David Eby announced on Sept. 12 that he will end the BC consumer carbon tax if the federal government scraps the legislation that requires provinces collect the tax. 

"I think it's critical to also recognize that the context and the challenge for British Columbians has changed. A lot of British Columbians are struggling with affordability," Eby told a crowd at a campaign rally.

When asked by media, federal NDP leader Jagmeet Singh wouldn’t say whether his party would keep the carbon tax if elected.

“We want to see an approach to fighting the climate crisis where it doesn’t put the burden on the backs of working people, where big polluters have to pay their fair share,” Singh told reporters.

Eby explained in a statement that a series of decisions in Ottawa have led to the climate crisis becoming increasingly politicized, which undermined support for climate policies across the country. He recognized that British Columbians are facing global inflation and high interest rates, and committed to tackling the climate crisis while addressing cost-of-living issues so residents can afford and benefit from lower-cost clean energy alternatives.

BC is expected to acquire $2.6 billion in revenue from the carbon tax this fiscal year. $1 billion will go back to eligible British Columbians through the climate action tax credit, and the rest will fund industry grants aimed at reducing emissions. 

Eliminating the tax could affect low income families, who receive more in tax credits than they pay in carbon tax. 

BC Conservative leader John Rustad repeatedly promised that, if elected, he would immediately scrap the carbon tax. Federal Conservative leader Pierre Poilievre has long campaigned against the consumer carbon tax, saying it does little to reduce carbon emissions while also negatively impacting working-class Canadians. 

While he intends to eliminate the carbon tax, Eby says it’s still necessary to reduce emissions, and accuses Rustad of not believing in climate change.

“To have a leader of a party in modern British Columbia that doesn’t believe in high-school level science, that believes that climate change is a hoax, that says that we’re all carbon beings, therefore that carbon can’t pose any threat to British Columbians, even as homes flood and our forests burn and we have smoky suburbs and heat domes — there is a very stark choice between us and the BC Conservatives,” said Eby, according to the Vancouver Sun.

Rustad responded to this, saying that Eby’s sudden announcement was, in his opinion, politically motivated to appeal to voters in the upcoming election.

“The only thing that’s changed is we're in the middle of an election, and he’s feeling the pressure," Rustad told CTV News. “Whereas us, as the [BC] Conservative Party, we have always been principled in what we're doing in terms of getting rid of the carbon tax, because quite frankly this is hurting average, everyday people.”

Rustad also accused Eby of having a “secret” plan to keep the carbon tax going through a backdoor $3 million levy.

“David Eby pretends his new tax will only apply to so-called ‘big polluters,’ but the truth is it’s a tax on everyone and everything. In reality, the costs will be passed down to everyday British Columbians in the form of higher prices for goods, services and essentials,” said Rustad in an update posted on the BC Conservative’s website.

Eby has spent the past 22 months defending the carbon tax, saying on Nov. 29, 2023, "Let me be clear. We will not back down. God forbid, if the rest of the country abandons the fight against climate change, BC will stand strong,” according to CBC.

Months ago, Eby dismissed a letter from Poilievre asking him to help halt a federal carbon price increase. 

“I don’t live in the Pierre Poilievre campaign office and baloney factory,” said Eby on Mar. 16, as reported by CBC News. “I live in BC, as the premier, and decisions have consequences. The fact we face is that if we followed Mr. Poilievre’s suggestion there would be less money returned to British Columbians after Apr. 1 than there would be if the federal government administered this increase directly.”

BC Green Party leader Sonia Furstenau responded to Eby’s announcement, demanding the province work to fix the tax instead of completely scrapping it.

“We need political leadership that is honest about the challenges that we face, and climate change is an incredibly serious challenge. It is an incredibly costly challenge. Look at the impacts of 2021 with the heat dome, the atmospheric river and the wildfires estimated to have cost the B.C. economy between $10 and $17 billion,” she told the Vancouver Sun.

BC became the first province to adopt a carbon tax when the former BC Liberals, who rebranded to BC United in 2023, introduced the measure in 2008. Different fossil fuels were taxed at different rates, depending on the intensity of carbon emissions they produced. Individual British Columbians were also required to pay the tax, which worked out to about 2.40 cents per litre of gas when it was first introduced.

At the time, the NDP opposed the tax, running an “axe the tax” slogan during the 2009 election campaign. Nowadays, the phrase is often uttered by Polievre.

The carbon tax was originally revenue neutral, meaning other taxes were reduced to ensure British Columbians didn’t pay increased taxes.

Eventually, the NDP came to support the tax, and after they came to power in 2017, they removed the requirement that other taxes be reduced as the carbon tax increases. Ever since then, the carbon tax has risen annually by $5 per tonne of emissions from its starting cost of $10 per tonne. The tax hit $80 per tonne this year, adding 17.6 cents to the cost of one litre of gas.

In 2019, the federal Liberal government implemented its own carbon tax, which applies to provinces that do not have their own carbon tax, meaning it does not apply to BC. Provincial carbon pricing programs are required to match federal pricing, which is currently set at $80 per tonne. As a result, BC’s carbon tax would not immediately go away if Eby removed it, as it would be replaced by the federal tax.