N.W.T. MLAs appear set to approve carbon tax — even though they don't like it

The carbon tax in the Northwest Territories is set to come into effect next month, but there appears to be little enthusiasm for the tax from MLAs — including the minister responsible for the plan. 

Few MLAs had positive things to say about the carbon tax bills, except that they weren't designed in Ottawa

N.W.T. Finance Minister Robert C. McLeod says he doesn't want to bring forward a carbon tax, but his plan is better than one devised by federal officials in Ottawa. (Alex Brockman/CBC)

The carbon tax in the Northwest Territories is set to come into effect next month, but there appears to be little enthusiasm for the tax from MLAs — including the minister responsible for the plan. 

Thursday, MLAs began their final debate on the two bills which, if passed, will bring the carbon tax into force on Sept. 1. 

During that two-hour session, few could find much to praise about the tax, including Finance Minister Robert C. McLeod, who maintained his long-held position that the tax is only coming because of the federal government.  

"Nobody is a fan of a tax, I'm not a fan of the tax," McLeod said "But these are the cards we've been dealt and we're trying to put the best hand together.

"If our approach is not used, there's going to be a federal backstop, which I believe will not be as good for the people in the Northwest Territories. Especially those in the small communities," he said.  

At one point, he expressed his hope that the next government in the 19th Assembly would be in a position to repeal the tax.  

Nobody is a fan of a tax. I'm not a fan of the tax. But these are the cards we've been dealt. - Robert C. McLeod,  N.W.T. Finance Minister

Though not ideal, McLeod did defend his plan as making the best of an unwanted situation. He called it a "made in the North" solution that does enough to keep the federal government from unilaterally imposing its own carbon tax on the territory, while returning as much money to Northerners as possible. 

What's in the carbon tax?

The N.W.T. carbon tax starts at $20 per tonne on fuel, which rises to $50 per tonne by 2022. At the pump, that's about five cents per litre, rising to about 10 cents per litre by 2022. 

To accommodate rising gas prices, and the general rise in prices that may result from the tax, the territory is including a new cost of living benefit. 

The plan also includes rebates on heating fuel, fuel used to generate electricity, and rebates for large emitters like the territory's diamond mines. 

"It is clear that the residents and businesses will be better with the [territory's] approach, than simply allowing the federal government to impose their approach to a carbon tax and spend the revenue as they see fit," McLeod said.

Stuck between a rock and a hard place 

Most MLAs who spoke about the bill Thursday said they didn't like the tax either, but felt it was the best of two bad options. 

Four regular MLAs — Danny McNeely, Frederick Blake, Shane Thompson and Herb Nakimayak — said they don't want to add a tax on their constituents, but they support the bills, signalling the government likely has enough votes to pass the bills into law later this session. 

Nakimayak, who represents Arctic communities with some of the highest costs in the territory, had few positive things to say about the bills, but said it's better than letting Ottawa make the decision instead. 

'If we went with the federal backstop, we'd definitely be paying more, and we'd definitely feel it further in the territories," he said.  

"It's OK, but I don't like it. That's just the way it is," he said. "I will support this [bill] knowing that it's going to bring the cost-of-living up, but then again looking at the feds and what they're doing, it would be even higher."  

Cory Vanthuyne, Kieron Testart and Kevin O'Reilly took their criticisms a step further. They've long criticised the government's plan as being ineffective and unlikely to make a difference in curbing emissions. 

Vanthuyne put most of the blame on Prime Minister Justin Trudeau, calling this "unwelcome and mandatory" tax a symbolic gesture that will only hurt Northern businesses and residents. 

Yellowknife North MLA Cory Vanthuyne, left, and Kam Lake MLA Kieron Testart, right, both oppose the government's carbon tax bills and say they will vote against them. (Chantal Dubuc/CBC)

Meanwhile, Testart and O'Reilly both say they felt the process to craft these two bills was rushed, with the government failing to co-operate with regular MLAs and ignoring their input. O'Reilly is also concerned about a lack of reporting requirements on how the revenue generated from the tax is spent. 

But for Finance Minister McLeod there's two choices: it's either this plan, or Ottawa's. 

"We've already asked the federal government to give us an exemption, because we're here, you know what the answer was," McLeod said. "They were bent on implementing carbon pricing, it didn't matter what part of the country you live in." 


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