Professionals Say that Carbon Tax and the CAI Payment Need a Rethink

In October, we asked tax and financial professionals “ In your opinion, is the Climate Action Incentive Payment enough to offset the rising cost of carbon taxes?” The fact that 89% felt it’s not sufficient was not surprising but the comments present some interesting insights on the challenges and potential solutions.

“Who in their right mind believes we can get back enough to offset the tax in the first place?  The intermediary - government - is the largest employer in Canada I believe. They can’t give you something they haven’t taken from you in the first place, and that means they can NEVER give you enough to offset what your costs are.”

By Doris Woodman-McMillan on October 18, 2023

The carbon tax is a tax on everything and serves to increase the cost of so many goods and services that it’s extremely difficult to evaluate the true cost of the tax. The economic damage caused by the carbon tax is another cost of the carbon tax that gets very little attention but shows up in our underperformance as a country when compared to other G7 and G20 countries. There is also a social in that the carbon tax punishes lower-income families more severely than it does higher-income families.

By Curtis Scoville on October 20, 2023

“The Carbon Tax is another hidden tax. It is on absolutely all goods that are freighted, and on all services that use electricity and natural gas (groceries, lumber, etc, etc etc).  Also, since the cost of living has increased because of the carbon tax, everyone needs a raise just to have the same disposable income as pre-carbon tax.The GST was implemented on January 1, 1991 to replace the 13.5% Federal sales tax on manufactured goods because this 13.5% was “A HIDDEN TAX” on all manufactured goods.  A final consumer had no idea how much tax they were paying on something.  Well, isn’t that funny how a hidden tax was removed and replaced with GST in 1991, and now we have a NEW HIDDEN TAX called the carbon tax.”

By Ron Carrobourg on October 18, 2023

“I agree that they should abolish the carbon tax.  Look at the price of oil, people were having a hard enough time trying make ends meet.  Now they are charged this carbon tax with GST charged on top of it.  When is it going to end?”

By Gay MacPherson on October 26, 2023

“No, the rebate does not offset the carbon tax. If it did, the rebate would equal the carbon tax, and there would be no pint in collecting it. The government collects a little more than they need, then returns the overcharge of your own money to you as an ‘‘incentive’’ rebate. You think the government is giving you something, so you think the tax is not so bad; and, maybe the party in power is looking out for you too.  Works for them.”

By Martin on October 25, 2023

“Definitely not!  Carbon tax and the rebate program is ridiculous.  We live in the cold north and making our home heating costs go through the roof is just malicious.  You’re never going to get companies to invest in green energy by increasing their costs.  It’s impossible to move forward if you put them in the hole.  Give them tax breaks for those investments, then you’ll be able to see the progress!  Makes one question the true intentions behind the carbon tax… why would they want us to use less when they make money off our usage?”

“Not even close, nor should it!  The Government has missed the boat on Carbon Taxes and the way they’ve structured the system by forgetting one simple fact.  When businesses have additional “tax” what happens is that their cash availability goes down.  This results in pricing going up as any and all impact on corporate profits and/or cash result in being costs passing to the consumer.

The Government would be much further ahead if they realized this fact and incentivize business with tax cuts as opposed to taxation.  Do you think the Steel Mills would be on-board if “carbon neutral” put cash in their hands to effect change instead of the current “penalizing” system?”

By Alan Rowell on October 11, 2023

“As per the previous comments, the carbon tax affects a broad range of products, anything that is shipped, home heating, the gas pump.  It will be interesting what happens in provinces using coal or natural gas as there are no exceptions.  Will those provinces automatically expect a higher carbon tax and how will it be accounted for.”

By Marilyn Sims on October 05, 2023

“No - not nearly enough. It is a tax applied to just about everything. Producers and manufacturers pass it on, shippers pass it on, wholesalers and retailers pass it on, and we, the consumers, get to pay for it. Consumers pay for it to heat their homes, drive to work and drive to the grocery store. All of these businesses pay it to heat their premises. On and on it goes.

“And the concept behind it… We want you to use less energy to reduce green house gases, so we increase the cost of using this energy so you will use less - but wait, we will then repay that extra cost. So, what is the incentive to use less if you repay me? Of course, the repayment doesn’t nearly account for all of the extra costs we incur.”

By Michael Connors on October 05, 2023

“Climate Action incentive payment is just another quarterly payment that should either be included on income tax return as a refundable credit or blended in with the HST quarterly payment to provide a more efficient delivery of benefits. Or, like a previous comment; abolish the carbon tax and the carbon benefit as both are designed for political purposes; are inflationary and have basically no impact on reducing the effects of climate change.  The processing and delivery of climate action incentive payments actually increases carbon as it leads to more paper which comes from the cutting, processing and transportation of trees which will use high amounts of diesel and other fossil fuels in addition to the fuels used in the delivery of the payments!”

By Bill Johnson on October 04, 2023

“If just considering the increase in costs to individuals for vehicle and heating fuels, the overall increase in pricing may be close. But when considering the inflationary increases to production of all foods and materials, as well as the significant increase in delivery costs to get products to market, in which the carbon tax is playing a major role in causality, then for most Canadians, are worse off, and progressively seeing their situation worsen.”

By Ronald Young on October 04, 2023

“As far as I can figure out, the actual cost of the carbon tax (in all its forms) will be over $2,000 more than most Canadians will see in “rebates.”  It is definitely not “revenue neutral”.  When you couple that with the incredibly high inflation, there will be a lot of people near to running out of money just to pay for day to day expenses.”

By Robert A Litschel on October 04, 2023

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