After two days of hearings in Regina on February 13th and 14th, the Saskatchewan Court of Appeal has reserved judgement on the question of the constitutionality of a federally-imposed carbon tax on the province of Saskatchewan.
Along with the provinces of Ontario, New Brunswick, and Manitoba, the Saskatchewan provincial government has opted not to implement its own carbon tax scheme. As such, Saskatchewan will be subject to the federal government’s imposed tax beginning in April 2019.
Premier Moe’s government introduced its own climate change law on October 30th that laid down a groundwork for standards to reduce industrial emissions. Premier Moe’s plan involved requiring large greenhouse gas emitters to register with the province with the potential for receiving credits when reaching targets. However, critics have stated that Saskatchewan’s proposed plan and failure to set up its own carbon tax scheme does not sufficiently commit the province to mitigating emissions and it does not meet the nation’s climate change benchmarks. The federal government has therefore opted to impose a carbon tax scheme.
The imposition of a federally-imposed tax would mean the government would set a price on carbon and those who purchase an emission-producing product would have to pay this tax. Under the tax, oil products, including diesel and gas, natural gas, and coal-fired electricity, would be affected. The federal tax will price carbon at $20 a tonne, or 4.4 cents per litre of gasoline, and is set to rise to $50 in 2020. In Saskatchewan, “the average family would pay $403 in carbon tax costs and receive $598 in rebates ($195 as a net benefit).”
In theory, it is anticipated that individuals would opt to cut down in their carbon use in order to avoid paying this tax, thus reducing carbon emissions. The revenue generated could be used in various ways, such as offering rebates to customers, spending it on emission-reducing measures, lowering other taxes, or including it as general revenue.
Saskatchewan’s legal counsel has argued that the province recognizes the seriousness of the climate change issue and that effective measures are required to deal with greenhouse gas emissions. The province emphasizes that this case centres around what powers the federal government has and does not have. The issue is whether the federal government is violating provincial jurisdiction with its imposed carbon tax under the Greenhouse Gas Pollution Pricing Act, which was introduced into Parliament on March 28, 2018, as Part 5 of Bill C-74. Fundamentally, Saskatchewan argues that the proposed carbon tax is unconstitutional.
Conversely, the federal government argues that, in fact, it does have the power to impose a carbon tax on provinces given that Section 91 of the Constitution Act, 1867 provides that it may pass laws for “peace, order, and good government” (POGG). It is contended that the issues of climate change and greenhouse gas emissions are considered a national concern, and that the federal government does have the legislative authority under its POGG power to impose the carbon tax on provinces, like Saskatchewan, that it deems have not taken sufficient action on the matter. From the perspective of Ottawa, a province’s failure to sufficiently regulate greenhouse gas emissions impacts Canada as a whole. Sharlene Telles-Langdon, a lawyer for the Attorney General of Canada, argues that “one province’s refusal or failure to sufficiently regulate greenhouse gas emissions impacts Canada as a whole” given that carbon pollutants have cumulative dimensions and that there are no geographical boundaries to emissions. Largely, Ottawa’s position is that, from a constitutional standpoint, the provinces are unable to address Canada’s overall emissions level and that the federal government is in a position to do so.
Lawyers on behalf of Saskatchewan argue against the federal government’s position that the imposed pricing act should fall under the POGG clause of the Constitution Act. Alan Jacobson, lawyer for the province, contends that the use of this clause can be considered as “sweeping, radical, and intrusive”, as well as disrespectful to the sovereignty of the provinces. Saskatchewan and it’s anti-carbon tax allies argue that the federal government is overreaching into provincial jurisdiction with the tax and that this threatens the balance of federalism.
As it stands, the Court of Appeal is reserving judgement until further notice given the complexity of the matter. Much is at stake with this case. The outcome will not only have an impact on Canada’s environmental goals and the balance of power between the federal and provincial governments, but will also have impacts on taxpayers, farmers, First Nations members, businesses, corporations, and various other interests.
This blog post was written by a CCLA-PBSC Rights Watch student. Views expressed do not necessarily reflect the views of the CCLA or PBSC.