B.C.’s carbon tax will increase by $15 per tonne next month to $95 per tonne, the latest in a series of scheduled increases that is expected to raise the cost of carbon pollution to $125 per tonne by 2028 and $170 per tonne by 2030.
The increase is forecast to raise $2.5 billion in provincial tax revenue by the end of the fiscal year, rising to to nearly $3.8 billion annually by 2028, according to the B.C. government’s latest budget.
The hikes are in line with federal carbon pricing requirements, known as the federal backstop. Much of that money is redistributed in the form of cash rebates, with those in lower-income brackets receiving more.
Budget documents say all of the additional $665 million raised by the upcoming carbon tax increase will be returned to British Columbians through the climate action tax credit.
Many experts say putting a price on carbon is one of the most efficient and equitable market tools to drop greenhouse gases across an economy. But in Canada, the carbon tax has become politically unpopular, with Conservative Party of Canada Leader Pierre Polievre calling to “axe the tax.”
Mark Carney and Chrystia Freeland, the leading candidates to replace Prime Minister Justin Trudeau at the helm of the Liberal Party, have also said they would repeal the federal carbon tax if elected.
B.C. Premier David Eby said he would repeal B.C.’s consumer price on carbon if Ottawa abandoned the federal backstop.
“Government remains committed to removing the consumer carbon tax should the federal government remove the requirement for carbon pricing across Canada,” reiterated the province in its latest budget Tuesday.
