Whitehorse Daily Star

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Pictured above: BRAD CATHERS, KATE WHITE AND KATHERINE WHITE

Parties critical of rebate framework

The territory’s opposition parties are saying the Yukon government’s carbon pricing rebate framework misses the mark,

By Palak Mangat on January 18, 2019

The territory’s opposition parties are saying the Yukon government’s carbon pricing rebate framework misses the mark, with one echoing the government’s own senior official who in part called it “nonsensical” Thursday.

The details of that model were released Thursday, during which two senior officials walked media through some of the changes that could allow Yukoners to expect quarterly cheques in the mail.

Documents show that the estimated levy paid by individuals is pegged at $3.41 million for 2019-2020, while being rebated $3.51 million.

That number will balloon to $11.7 million in rebates by 2023-2024 after people pay $7.57 million in taxes.

In a breakdown comparing the levies paid by individuals, businesses (non-mining), placer and quartz mining operations, First Nations governments and municipal governments, the documents also note that individuals will be paying the highest levies across the board for all the years from 2019 to 2024.

“One of the reasons it’s so nonsensical is that you take out all the exempt groups,” said Katherine White, the deputy minister of Finance.

She pointed out that individuals are also the ones being rebated the most amount, after being taxed the most.

“The largest part of our economy is the people in this territory, hence at the end of the day they’re paying the highest levy.”

To offset that cost, which she acknowledged could lead to a slight bump on goods and services, the government decided to “disproportionately rebate individuals.”

But that didn’t convince Brad Cathers, finance critic for the Yukon Party, who told the Star Thursday “the overall message (is) that the structure is nonsensical.”

While he was pleased to finally see details (his party in particular had been pressing Premier Sandy Silver on carbon tax almost on a daily basis at times during last fall’s sitting), Cathers remains skeptical.

“We’ve yet to see evidence that it will actually work,” he said, noting that “what was really telling was the deputy minister of Finance admitting some of the information is nonsensical.”

Cathers also cast doubt on the government’s claim that it would not need more resources to administer those cheques.

That was after Clarke LaPrairie, an assistant deputy minister of economics, fiscal policy and statistics with the department, explained the Canada Revenue Agency (CRA) is to release those cheques through its tax system already set up.

“We are not growing government, not a single full-time employee, new employee will be hired to administer this program,” LaPrairie said. “We have to leverage existing programs as much as possible.”

Cathers said that was hard to believe, especially when it came to those in the mining sector. The documents note that those eligible under placer and quartz mining operations are to apply for a rebate from Jan. 1, 2020 for work done throughout the previous fiscal year.

“We see that structure of system they put in place for the mining sector, which will place a high paperwork burden on small businesses,” Cathers said, adding that the “administrative burden” must be accounted for somewhere.

For his part, LaPrairie maintained it would be covered under the CRA’s belt.

Meanwhile, the Yukon NDP’s Kate White said that while the rebate structure “sounded nice, there’s some missed opportunity here.”

She acknowledged that talk about redistributing the money gathered from the tax within the community had come to fruition via the framework.

However, she told the Star Thursday, what would happen with that revenue after was very much still in the air.

“It’s a missed opportunity; we’re not talking about reinvesting money ... to reduce the carbon footprint and bring it down,” she said.

Asked about this, Silver maintained that his government’s promise had been kept.

“As opposed to us taking that money and putting it towards something (like retrofits), who better to decide how to spend that money to make their houses more efficient than Yukoners themselves?” he asked.

Katherine White acknowledged that putting out such a framework was a challenge.

“This is so complex,” she said. “We of course haven’t made everyone happy because there’s a lot of balance and it’s quite a complex system.”

She explained that the territory and country as a whole would likely be “ground truthing” the rebate system in the coming years.

“From an economic perspective, there’s no reason to think that rebates would reduce the reduction in greenhouse gases provided by the carbon tax,” the deputy minister said.

“But what it does do is put a little bit more money in your pocket if you do want to invest in something that has lower emissions – like more insulation in your house.”

Beyond that, YG has programs that can help households wanting to make that switch, she added.

Still, the NDP MLA questioned how that money would be reinvested into better behaviour, saying she was a “little bit disappointed.

“That sounds good, but why aren’t we incentivizing more people to take the bus, why not talk about that?” Kate White asked.

When it came to the incentivizing for businesses, she was happy to see that they could get among other things an equipment rebate of $8.62 for every $1,000 in assets for this year (a figure that would grow to $28.73 come 2023).

“We talk about rebate programs around things like high energy or high efficiency wood stoves – but if you can’t afford it, the initial output, then you can’t collect that bonus,” said the NDP’s White. That may hamper the ability for smaller businesses with fewer cash at their disposal to apply, she added.

While the government official said that she “believes, based on what we see, this will actually improve the action,” the MLA remains skeptical.

“Carbon pricing is very important, but it’s supposed to change people’s habits,” Kate White said.

“If you are supposed to be making different decisions and different choices, where does this encourage them if all the money (is going back)? It’s the constant question.”

She also wondered how this could impact those on the lower earning spectrum.

“One of the really big questions is will this affect people who are accessing government social safety net, those who get social assistance or top-ups.”

While Kate White acknowledged that things still seemed hazy at this stage, it was a matter of waiting until they were put into practice – including the work of public servants stamping those cheques.

“Would this have been my first choice? No,” the MLA said.

“But I get reminded of that (the Liberals’ 2016 campaign promise to return the revenues from the levy).”

Meanwhile, Cathers continued to be critical of the exemptions that were handed out via negotiations through Ottawa, saying it was akin to picking winners and losers.

“The trucking sector is being treated very differently from aviation,” he said. The former is not exempt from the levy, he noted, while aviation fuel and light fuel for electricity generation in other remote communities are.

Cathers isn’t alone in his concerns about exemptions: while the Yukon Conservation Society (YCS) echoed this, it did not have doubts about whether it would achieve its ultimate goal.

Cody Reaume, an energy analyst with the YCS, told the Star this morning he was happy to see the details of the levy finally come out.

“Carbon pricing is one of the tools in the toolbox” to gradually reduce greenhouse gas emissions, he said, adding it is “a step in the right direction.

“We’ll see how this sort of pans out.”

Reaume likened the framework to one that is “market-based, leaving people free to make changes to their lifestyles or business.”

As for whether the better option would have been YG taking those funds on behalf of Yukoners and investing them in areas to incentivize people, he said the proposed model allowed for more flexibility.

People can now use those funds “however they want; they don’t have to go for a specific product that’s subsidized or anything,” Reaume said.

Cathers wondered if there could be more of an effort toward “incentive-based approach in reducing fossil fuel emissions and greenhouse gases,” beyond things like the super green credit that businesses may see that are encouragements.

That is to “support Yukon businesses as we transition to cleaner economy,” the documents noted, adding it is to ultimately “encourage future investments in clean energy generation and energy conservation equipment.”

Reaume also wondered whether handing out exemptions to certain industries was a wise call, given that “climate change is a global problem.

“For YCS, we really believe in a fair share principle – we should all be paying our fair share.”

He acknowledged that living in the North could of course present its own challenges, especially in those remote areas: “it is a challenging question, how do you define fair share? I can see that as a big challenge.

“But what’s clear to us is that zero isn’t a fair share,” he said, referencing the pass given to aviation fuel.

While it would be nice to see all industries paying into the levy, he cautioned from issuing a flat-out, 100 per cent exemptions to certain key players.

“In that case, when you get a 100 per cent (pass) ... the incentive for carbon tax is now gone,” Reaume said.

“Those industries have no incentive to look” for cleaner alternatives down the road.

The carbon tax itself is set to hit the Yukon in July of this year, thanks to the territory negotiating an extension.

Comments (10)

Up 6 Down 4

Hugh Mungus on Jan 23, 2019 at 1:26 pm

How does a baby cash a cheque?

Also how much administrative overhead does it cost to take money with one hand and give it back with the other?
YG would have been better off applying the tax to homeowners still using oil/forced air heat and those 'compensators' with the big trucks.
If one person is in a green home with a electric vehicle why should they pay the same as someone in a leaky old house with 2 Dodge dualies?

Up 3 Down 22

David on Jan 21, 2019 at 10:24 am

No it's not perfect, there could definitely be some improvements, but at least it's a step in the right direction.

Up 15 Down 3

What else is there to say on Jan 20, 2019 at 5:48 pm

The Deputy Minister of Finance called this policy nonsensical. Nuff said.

Up 5 Down 18

Dan Huntsman on Jan 19, 2019 at 10:35 pm

Why not consider using the tax to provide tax rebates for hybrid vehicles.
For example, a tax refund of $1000 to $2000 per year to make hybrids more affordable for people.

Up 18 Down 3

EM BARUSSED on Jan 19, 2019 at 10:10 pm

@ Freudian and Jay et al. - You are absolutely right about this government. They are nonsensical, farcical and stupidly malicious. These people should not be in charge of anything, let alone themselves.

At Juniper - You are correct about the division of society. The Liberal playbook is essentially a manifesto for divide and conquer politics. The politics of identity is one tool by which their plans are achieved.

Another is the control of institutions like the court. For example, I have been informed by a friend in the court that they are planning to take over the function of Probation Officers. Although the courts do not plan to enforce or even monitor the conditions that they place on Bailee’s and offenders they will report that things are going well. Quite frankly because the people on these conditions will not abide by them.

This should not just shock the conscience but it should offend any sense of the concept of justice - The Judge as the arbiter of all - The Social, the psychological, and the political. The Yukon is so far out past the horizon it is concerning and it is down right scary.

The court knows this so it will ignore compliance. Making everyone else less safe; BNEs, home invaders, spousal violence, good old regular violence and even sexual deviants will get a pass to give the appearance that justice works and judge knows sagely... The right path.

Google the - The Good and the Bad: Judge Stuart's R. v. Moses Legacy:

http://www.duhaime.org/LawMag/LawArticle-1252/The-Good-and-the-Bad-Judge-Stuarts-R-v-Moses-Legacy.aspx

And ask yourself why this should happen? There will be no expectations to do anything other than have your name on a “specialized” court list. The court will even be spared the embarrassment of a Gladue Report.

Up 33 Down 3

Jay on Jan 19, 2019 at 12:37 am

Hah hah hah! The Premier's own staff member even said this thing is nonsensical!

So the government is telling us they will take our money for a couple of months. Then we get a 43 dollar rebate and somehow they want me to be able to afford to renovate my house and buy an electric car. What world do these people live in that they think that all these green renovations cost only 43 dollars?

No wonder the Premier's staff are saying this thing is nonsensical.

Up 27 Down 4

Freudian slip on Jan 18, 2019 at 6:24 pm

Looks like the Deputy Minister accidentally spoke the truth by saying that this carbon tax is "nonsensical"! Something we all knew all along. But at least someone in the government finally admitted it!
Question is why aren't the Liberals taking her advice and scrapping this nonsense?

Up 29 Down 4

Juniper Jackson on Jan 18, 2019 at 4:27 pm

This government was given the opportunity to provide meaningful change.. to bring us together, rather than drive us apart.. I don't know if it's Sandy talking or Sandy infatuated with Trudeau spouting Trudeau crap.. but they blew their opportunity.. (shades of Notley) I am appalled at the elected representatives that do nothing about this type of nonsense. @save money... I believe you nailed it!!

Up 25 Down 4

Scales balance on Jan 18, 2019 at 3:53 pm

So natives, aviation, and miners got an exemption. Okay, time to start charging more.

Up 35 Down 13

save money on Jan 18, 2019 at 3:14 pm

Just stop and cancel it and do something useful, like resign and move to some SJW paradise with Trudeau, Clinton, Obama, Pelosi & Soros...where everyone wants to be extorted and scammed and sings in unison in the echo chamber. Actually, Guantanamo Bay sounds appropriate - newly renovated and expanded to make room for all your cronies. Win-win situation for everyone.

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