Canada is moving to put a minimum national price on carbon, as part of our efforts to address climate change. Some provinces already have a price on carbon dioxide (CO2) and other greenhouse gas (GHG) emissions. These taxes aren’t consistent, and many provinces don’t apply a specific tax or price to carbon and other GHGs.

CUPE’s national environmental policy supports putting a price on carbon, but it must be done in a progressive manner that enhances public services and environmental justice and doesn’t hurt lower-income, working and Indigenous peoples.

The federal government will require all provinces to introduce a minimum tax of $10 per tonne on GHG emissions by the end of 2018, rising to $50 per tonne by 2022. A carbon tax at these rates would add about 4.4 cents to every litre of gasoline next year, rising to 11 cents a litre after 2021. A carbon tax at $10 per tonne will increase costs for each Canadian by about $90 a year, and a rate of $50 per tonne will increase costs by about $450 annually. These costs will vary by region and by the circumstances of each person.

It’s important to ensure the substantial revenues raised from pricing carbon and GHG emissions are spent in ways that help households, workplaces and communities reduce their GHG emissions, with a focus on helping lower and middle-income households. These households face the highest increase in costs as a share of their income from putting a price on carbon. Alberta’s climate change policy helps achieve fairness with its investments in complementary environmental measures and rebates for lower- and middle-income households.

British Columbia was the first province to bring in a carbon tax at $10 per tonne of CO2 or its equivalent in 2008. Today, the tax is $35 per tonne. The tax applies to fossil fuels, including gasoline, diesel, natural gas, coal and other GHGs. Rates are set according to a fuel’s potency as a greenhouse gas. BC’s current carbon tax adds 7.78 cents to the price of a litre of gasoline. This is significant but is still only between five and seven per cent of the price at the pump. On average retail gas prices swing by more than this percentage from one month to the next.

A carbon tax on its own will slow short-term economic growth by taking money out of the economy. But if the revenue is spent in productive ways that stimulate the economy, pricing carbon can boost economic growth and create additional jobs, while also protecting the environment.

Despite being the first to introduce a carbon tax, BC has significantly exceeded all other provinces in economic growth over the past decade, growing 40 per cent faster than the national average. The province is expected to top the economic growth leaderboard again this year and next.

Putting a price on carbon is only part of what is needed to reduce emissions and address climate change. A carbon tax alone would have to be over $200 per tonne to achieve the reductions we need to make, which could be devastating for the economy. It’s far more effective to use a variety of tools, including direct regulation of polluting industries, public investment in climate-friendly initiatives, education and research and development.