Repatriate the Carbon Tax

June 23, 2021 | By


With economists widely in agreement about the efficiency and effectiveness of carbon pricing as a key tool to reduce emissions and the Supreme Court of Canada having ruled in favour of the constitutionality of the federal carbon tax, it’s time for Alberta to take a different approach than it has recently.

Instead of letting the federal government collect the carbon tax and decide what to do with the revenue, the provincial government should implement its own consumer carbon tax and keep the revenues in Alberta. The revenue could be used for any number of ways to support Albertans and invest in our competitiveness. For example, the provincial government could use it – or some portion of it – to reduce income taxes for all Albertans. By reducing income taxes (and raising the basic minimum amount) Alberta can let people who work here keep more of their wages and salaries.

In the process it can help attract skilled labour, give businesses another reason to relocate to the province, and make the province an even better place to earn a living – all without increasing what Albertans are already paying for carbon taxes.