The Federal Court decided in Saskatchewan’s favour on the carbon tax, blocking the federal government from garnishing provincial funds, while awaiting a full hearing by the Federal Court. Pictured: Saskatchewan Premier Scott Moe. Photo Credit: Scott Moe/X.
In the latest chapter of the ongoing war between the federal Liberals and the Saskatchewan government, the province prevailed. Federal Environment Minister Steven Guilbeault had threatened to force Saskatchewan to pay the carbon tax amount it did not collect for 2024 to date via the Canada Revenue Agency. The CRA claimed that the province owed about $42 million in unpaid carbon taxes. The whole brouhaha began when the Trudeau government opted to create a “carve out” exemption of the carbon tax for home heating oil in October last year, an exemption that clearly favoured the Atlantic provinces which are by far the biggest consumers of heating oil in Canada.
The motives behind this change were clearly political on the Liberals’ part as polls showed the Atlantic provinces – usually reliable Liberal supporters – were turning against the federal Liberals and the carbon tax was one of the reasons. The decision also undermined the entire rationale for the carbon tax, as it was supposed to be universally applied to be effective. Even more damaging to the Trudeau government’s credibility on climate policy was that they were exempting heating oil, a form of energy that was a much higher source of emissions than other fuels such as natural gas.
The decision to exempt heating oil was purely political and showed the Liberals didn’t really care about climate issues, as they constantly claim, if it meant that votes were at stake. One Liberal Minister, Gudie Hutchings, even had the gall to say that if Western and Prairie provinces wanted to receive carve-outs from the federal government’s carbon pricing policy, they should elect more Liberals. So much for the fundamental principle of an elected government in a democracy representing the interests of all citizens. Hutchings certainly made it clear that this principle was not one in which the current Liberal government is at all interested, which speaks volumes – and not in a good way.
Saskatchewan Premier Scott Moe, among other premiers, was rightly miffed by this clear favouritism and declared that he wouldn’t impose the carbon tax on his citizens’ heating source, whatever it happened to be. Most of Saskatchewan households heat with natural gas. This reaction led Guilbeault to call Moe immoral and irresponsible and threaten Criminal Code sanctions. In response, Moe famously said, “Come get me.” In the context of our usual mundane politics, this was high drama for Canada.
As a response to the federal attempts to force Saskatchewan to pay up, the province applied to the Federal Court for an injunction to stop the CRA from collecting the carbon tax. This week, the court decided in Saskatchewan’s favour, blocking the federal government from garnishing provincial funds, while awaiting a full hearing by the Federal Court. The province is defending its position legally on Constitutional grounds. Saskatchewan was previously a party to the appeal to the Supreme Court of Canada of Bill C-69, the federal Impact Assessment Act – otherwise known as the “no more pipelines” bill – which turned out to be another victory on the basis of jurisdiction for the provinces involved.
In the past couple of years, several court decisions have favoured the provinces over the federal government on jurisdictional matters. This is a trend that all provinces should be supporting, especially considering the courts initially backed the federal Liberals when the carbon tax was first imposed, despite there being well-founded jurisdictional concerns involved in that proceeding.
This latest win on carbon tax revenues for Saskatchewan may, however, be short-lived as the full hearing has yet to take place. Timing is of the essence, as the longer this proceeding can be delayed, the more likely Canada will see a federal election which will, by all current indications, oust the dictatorial Trudeau regime. Saskatchewan will undoubtedly want to drag this out legally for as long as possible. On the basis of recent decisions, however, courts at all levels have been increasingly sympathetic to the concerns of the provinces, which bodes well for Saskatchewan’s chances.
Back in 2015 when the Trudeau government was first elected, Trudeau made a big deal about claiming that federal-provincial relations under his government would be much more harmonious than under the Harper regime. Considering that every federal government of any political stripe always ends up at odds with their provincial counterparts, this was an arrogant and ill-informed claim. Although Harper had disputes with the provinces during his tenure, as every Prime Minister does, he was actually very respectful of provincial rights and did not suffer legal losses on jurisdictional issues as Trudeau has done. So once again, an initial Trudeau government promise goes unfulfilled.
For the Liberals, a key consideration must be that despite all of the opposition to their carbon tax carve-out for the Atlantic provinces: did it help them regain any votes? To date, the indications are that the strategy is an abject failure. Even in the Atlantic region, many households do not use heating oil and are resentful that the exemption did not include them. As well, the blatant political nature of this Liberal gambit was so obvious that even the people who may have benefitted from it financially remain cynical. After nine long years of the Trudeau government’s economic punishment of Canadians, they can’t seem to catch a break. Maybe they just don’t deserve one.
She has published numerous articles in journals, magazines & other media on issues such as free trade, finance, entrepreneurship & women business owners. Ms. Swift is a past President of the Empire Club of Canada, a former Director of the CD Howe Institute, the Canadian Youth Business Foundation, SOS Children’s Villages, past President of the International Small Business Congress and current Director of the Fraser Institute. She was cited in 2003 & 2012 as one of the most powerful women in Canada by the Women’s Executive Network & is a recipient of the Queen’s Silver & Gold Jubilee medals.
