Nunavut MLA decries GN’s $15M carbon tax windfall

Iqaluit-Tasiluk MLA George Hickes said that by allowing the federal government to impose a carbon tax on Nunavut by default, the GN may be relinquishing control over how it’s administered. Ottawa’s backstop carbon tax is expected to dump an extra $15 million into the GN’s coffers next year. The GN has the authority to decide how to spend that money, but it’s not clear if the GN will have any say over who will be taxed and how.(FILE PHOTO)

By refusing to put its own price on carbon emissions, the Government of Nunavut has likely handed control over the process to the federal government, Iqaluit-Tasiluk MLA George Hickes said last Friday in the Nunavut legislature.

Hickes made the comment in response to a statement on May 30 from Finance Minister David Akeeagok.

In that statement, Akeeagok said Nunavut is opposed to a carbon tax and will not create its own carbon pricing system.

Instead, the GN will let the federal government collect its own backstop carbon tax and give the money back to the GN. That means that next year, the GN will get an extra $15 million in revenue.

But Hickes, on June 1, said that represents a relinquishing of control over how planet-warming carbon dioxide emissions are taxed and administered in Nunavut.

“In the minister’s statement, the government was celebrating $15 million in new revenue. Mr. Speaker, this is an empty celebration. These revenues are based on someone else deciding to impose a tax, increasing an already high cost of living for Nunavummiut,” Hickes said.

The MLA went on to ask Akeeagok if the federal government will grant exemptions to groups that could be hurt by the imposition of a carbon tax in Nunavut.

“Other jurisdictions have exempted certain groups or industries in their carbon tax plan. By relinquishing control over a tax on our residents to an outside jurisdiction, are there discussions imploring the federal government to provide exemptions to such groups as harvesters feeding their communities?” Hickes said.

Akeeagok responded by saying that “a very high level” working group of civil servants from Nunavut and the federal government are working on questions like that, and are trying to figure out how to administer the backstop carbon tax in the territory.

He said the GN is seeking exemptions for things like aviation fuel and home heating oil.

“There are a number of exemptions that we would like to see, such as aviation fuel. We don’t have a choice of flying our food here,” Akeeagok said.

However, the group that’s working on the issue is still in the middle of its discussions, he said.

The backstop carbon tax will charge $10 per tonne for carbon emissions in its first year, but will rise to $50 per tonne by 2022.

That will cost Nunavut households a total of $3 million in the first year and rise to $11 million a year by 2022, according to a report done for Nunavut by the federal Department of Environment and Climate Change.

For households, the financial impact for 2018 is estimated like this:

• Bottom third of household income earners: $120 per year.

• Middle third of household income earners: $360 per year.

• Top third of household income earners: $535 per year.

Carbon Pricing Analysis—Nunavut by NunatsiaqNews on Scribd