Ontario moving ahead with legal challenge of planned federal carbon tax
The Tory election platform budgeted $30-million for a carbon tax court challenge
TORONTO—Ottawa’s attempt to impose a carbon tax on the provinces is unconstitutional because the federal government does not have jurisdiction to regulate greenhouse gas emissions, the Ontario government argues in court filings connected to its legal challenge of the Liberals’ emissions pricing law.
In documents filed Friday, the province’s Progressive Conservative government argues the federal Liberals are trying to impose a form of “unconstitutional disguised taxation.” Allowing Parliament to regulate all greenhouse gas emissions would “seriously disrupt” the balance of power set out in Canada’s constitution, the Tories say.
“The provinces are fully capable of regulating greenhouse gas emissions themselves,” the government’s factum says.
It also argues that the “charges” the federal law imposes are “neither valid regulatory charges nor valid taxation.”
Ontario launched its legal challenge of the federal government’s Greenhouse Gas Pollution Pricing Act this summer, after Premier Doug Ford promised to fight the imposition of a carbon tax in court.
The federal government has said it will “backstop” any province that does not have its own carbon price in place by 2019, and will return most of the proceeds to taxpayers in that province.
Ford scrapped Ontario’s cap-and-trade system after winning a majority government in the spring election, triggering the need for the federal backstop.
Provincial Attorney General Caroline Mulroney said Ontario cannot stand back as the federal government imposes the carbon tax.
“The federal carbon tax takes money from families’ pockets and makes job creators less competitive,” Mulroney said in a statement.
A spokeswoman for federal Environment Minister Catherine McKenna said carbon pollution has no borders and climate change is an issue of national concern. The federal government is confident of its authority to take action on climate change, she said.
“Any serious plan to tackle climate change needs to have a price on pollution,” Caroline Theriault, McKenna’s director of communications, said in a statement.
Former Ontario premier Kathleen Wynne called the province’s legal challenge against the federal carbon price a waste.
“It’s really counter-productive in terms of our ability to proclaim to the world that we’re a jurisdiction that ‘gets it’—that we understand where the future lies,” she said.
Critics have said Ontario’s court challenge will be costly and has little chance of success. The Tory election platform budgeted $30-million for a carbon tax court challenge.
Allan Hutchinson, a constitutional law expert and professor at York University’s Osgoode Hall law school, said the federal government has the upper hand in this case.
“The general view of the legal community is that this has not really got any legs,” he said. “The Supreme Court has spoken about these matters before.”
Hutchinson said the courts have ruled that in some situations a national policy is needed to ensure a single province doesn’t opt out of a federal law and render it ineffective. That is what the federal government will likely be able to successfully argue with its climate change plan, he said.
But the Ontario government’s objective may not be to win the case at all, he said, adding that the Tories may simply be playing to their supporters.
“It’s a way of passing the buck and retaining a certain degree of political credibility,” he said.
Meanwhile, despite months of assurances by the Tories that they would not impose a carbon price, Ontario’s environmental commissioner said the province is doing just that with its new climate change plan.
Dianne Saxe said the Tory plan to introduce standards on the province’s largest emitters is the equivalent of the federal price on carbon set to be imposed on the province in 2019.
“They’re calling it a standard, but they’re not imposing a standard,” she said. “They’re imposing a carbon price with a benchmark—which is what the federal carbon tax is.”
A spokesman for the provincial environment ministry said the government’s plan intends to reduce emissions without a “blanket carbon tax.”
“Our approach would set greenhouse gas emissions performance standards that industrial facilities are required to meet and ties emissions to the level of output or production from these facilities, rather than an absolute cap on emissions,” Gary Wheeler said in a statement.
Saxe said overall, the plan is not as ambitious as the previous Liberal government’s strategy to fight climate change.
“What the Ontario government is doing now is saying that at best Ontario is going to reduce its emissions eight per cent in the next 12 years,” she said.
“If that’s what the world as a whole does, we are toasted, roasted and grilled. We have a mountain of studies that say that is not nearly enough to avert catastrophe.”