A privately funded group has released a huge report that calls for an increase in the carbon tax by $210 per tonne. The current tax is set at $30 per tonne with a 2% increase that is tied to rising inflation.
The Ecofiscal Commission of Canada says the country needs a 40-cent rise at the pumps in 10 years’ time. The rise is to combat climate change and reach the government’s goal to cut Canada’s greenhouse gas emissions by 30 per cent in 2030 as laid out in the Paris Climate Agreement.
Multiple scenarios were laid out in the report that included subsidies for electric vehicles could cause an income tax hike of 1.5 to two per cent while another scenario that mainly relies on regulation and subsidies for corporations could cost more, upwards of four to six per cent increase in income tax.
The federal government has created rebates for the current carbon tax rate that is supposed to cover the added costs for households.
The Ecofiscal Commission concluded that, while politically controversial, the carbon tax is the best and most cost-effective approach to tackle climate change.