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North America’s first carbon tax is set to roll out this coming Tuesday in the Canadian province British Columbia. This means British Columbians can start expecting to pay even more at the pump and to their utility as the tax will apply to transportation fuels and home heating oil starting July 1.
With oil prices setting record highs the past few weeks, the timing for this tax couldn’t be worse. The tax isn’t designed to raise revenue for the government and will be accompanied by a one-time C$100 rebate as well as tax cuts elsewhere. Still, critics are not thrilled that a new gasoline tax will send prices at the pump even higher. Opposition have already organized “axe the tax” initiatives and have proposed to modify the tax to apply only to business and industrial emitters, sparing the individual consumer.
Originally announced in February, the tax will start by tacking on a C$10 per ton of CO2 charge to fossil fuels, increasing by C$5 per ton per year for four years. Although it comes at a painful time, a carbon tax is thought by many to be a more effective measure to reduce carbon emissions, compared to the more politically palatable cap-and-trade approach. Similar proposals have been made in the U.S., but so far with little traction.