Sustainable Simcoe North

Axe the Tax or Eat the Rich?

—by Madeleine Fournier of Green Orillia

We’ve all heard it: “Axe the tax!” It’s an oft-repeated catchy right-wing slogan about rolling back the federal government’s carbon tax. But is it rooted in fact and logic? 

The carbon tax is what it sounds like: a tax on goods and services that use fossil fuels. Because, you know, we’re living on a rapidly heating planet characterized by increasing droughts, heat waves, floods, and wildfires.

But make no mistake: we are also living in an affordability crisis where rent costs more than half of many people’s income, and jars of tomato sauce cost up to $20. Canadians are understandably mad that they have to pay for the climate crisis on top of that. 

But did you know? 80% of Canadians get more money back in their pockets from the federal carbon rebate than they do paying for the carbon tax. Seriously, check your last tax return. It essentially offsets the cost of the carbon tax. 

You might then ask – what is the point of taxing us if the government is just going to give it back? 

That’s how the carbon tax works – richer people with fancy cars, private jets to fly, and bigger homes to heat pay more in the carbon tax than they get back. It’s essentially just taxing the richest percentile of the population – the rest of us likely pocket more than we pay. 

But what about the $20 tomato sauce? Why are prices rapidly rising and the cost of living is exorbitant? Does the carbon tax affect that? The answer is, only a very small amount. The direct effects of carbon pricing account for only 0.15 per cent of the inflation we’ve been experiencing — so the carbon tax is not a major driver of inflation. Including both the direct and indirect price impacts, the effect is 0.207 per cent a year in Ontario (one-fifteenth of current inflation). 

People in Canada are feeling the impacts of rising costs and want something to blame, and carbon pricing has been a convenient scapegoat. Yet other factors, such as price gouging by massive corporations play a much larger role in the volatile and rising prices. $20 tomato sauce? Blame rich and greedy capitalists like Galen Weston, CEO of Loblaws. The cost of heating your home has gone up? Blame rich energy companies like Enbridge. Rising prices of gas at the pumps? Blame the big five oil companies whose profits more than doubled in 2022! 

War, militarism and imperialism are also a big factor in inflation and rising prices. For example, Russia’s invasion of Ukraine has driven inflation up by disrupting energy and food supplies, causing supply chain disruptions, increasing military spending, leading to economic sanctions, driving up commodity prices, and creating overall economic uncertainty. These factors have interacted to create significant inflationary pressures worldwide. 

And let’s not forget the impacts from climate change itself, such as damage from heat waves, floods and droughts that reduce farm yields and are also increasing prices. 

So yes, I do support the carbon tax as one small step. The world needs to transition to clean, renewable energy as a response to the climate crisis and energy insecurity. Policies such as carbon pricing speed up this transition. A carbon tax sends a message to many companies and consumers to move away from polluting activities. It encourages investments in renewable energy and technology, making them more available and lowering their prices. 

But what I support even more is tackling the root causes of both the climate and affordability crisis: profiteering, imperialism, unfettered capitalism, and corporate greed. Canada signed the Paris Agreement in 2016 and committed to reducing its greenhouse gas emissions by 30% below 2005 levels by 2030.

However, many research groups have rated Canada’s climate target, policies and climate finance as “Highly Insufficient” overall, indicating that Canada’s climate policies and commitments are not consistent with the Paris Agreement’s 1.5°C temperature limit. Massive corporations are increasing production and blocking climate action – they’ve got our government in their pocket. Let’s focus on the real enemies and fight for a liveable and just future. 

Green Orillia is a grassroots organization focused on climate action, social justice, advocacy, education, democracy, and community resilience in Orillia and area. Follow Green Orillia on Facebook, Instagram, and Twitter, join the Facebook Discussion Group, sign up for the e-newsletter, or check out the website. Get in touch at greenorillia@gmail.com

—photo by Deb Halbot