NWT delays carbon tax introduction until September

A file photo of the Big River Service Centre in January 2019. Sarah Pruys/Cabin Radio
A file photo of the Big River Service Centre in January 2019. Sarah Pruys/Cabin Radio

Residents and businesses in the Northwest Territories will now not see a carbon tax introduced until September 1, 2019 – a two-month delay.

The NWT government had initially intended for the tax to roll out on July 1.

On Wednesday, finance minister Robert C McLeod said the current legislative backlog meant necessary provisions would not be in place in time for the original date to be maintained.

Instead, McLeod expects the relevant legislation – currently being reviewed by a committee of MLAs – to be presented and passed in August, allowing the NWT’s carbon tax to begin in September.



“The delay was unintended and should in no way be considered a lowering of the government’s commitment to implementing the NWT carbon tax,” McLeod – who will step away from politics at this fall’s territorial election – told colleagues in the legislature.

According to McLeod, the federal government has been consulted, understands the legislative issue, and will not seek to have the federal “backstop” carbon tax kick in on July 1 in the absence of an NWT tax.

The territorial government has long contended – and McLeod reiterated on Wednesday – that its own carbon tax is a better deal for northerners than the backstop, and the best it could do in circumstances where Ottawa mandated that provinces and territories come up with carbon pricing of some sort.

The NWT’s planned tax includes 100 percent rebates, when applied to heating fuel, for residents and small businesses; significant rebates for larger industry; and an exemption on aviation fuel, all of which the territory says will help the NWT avoid a further increase in the northern cost of living.



Critics, however, say such a system of rebates makes the tax itself all but pointless – providing little, if any, incentive for anyone to change their behaviours.

In situations where it is paid in full, the NWT’s carbon tax will begin by charging the equivalent of $20 per tonne of greenhouse gas emissions, rising to $50 per tonne over subsequent years.

The territorial government’s carbon pricing website – which, as of 7:30pm on Wednesday, had not been updated to reflect the new implementation date – sets out the carbon tax’s ramifications, and rebates, in full.

McLeod will speak with Catherine McKenna, the federal climate change minister, on Thursday, he told the legislature.

Upheaval elsewhere

Earlier this week, Alberta under new leader Jason Kenney formally abandoned its carbon tax as first introduced by the NDP government of 2017.

“Climate emissions are a global challenge,” said Kenney last week. “Overwhelmingly, the growth in emissions comes from the Third World. That’s where we need to share technology to reduce emissions and that’s exactly what [a new Alberta] technology innovation and energy research fund will do.”

On Monday, Prime Minister Justin Trudeau countered: “We need to be taking real action to prevent climate change. That’s why we’re moving forward on a price on pollution right across the country, despite the fact conservative politicians are pushing against that.”

In Ontario, an environmental think-tank this week argued the Ford government’s planned approach to climate change would be significantly more expensive, for households and businesses, than the federal backstop.

Canadians for Clean Prosperity said Ontario’s plan would be costlier as it targets only specific sectors, making it more difficult to administer than an economy-wide carbon tax.

Last month, Doug Ford’s Progressive Conservative government released TV ads focusing on what the province claims is the increased cost of fuel, arguing: “A carbon tax isn’t the only way to fight climate change.” Critics said the ads omitted important facts.