British Columbia will keep its carbon tax frozen at C$30/tonne until at least 2018, the Canadian province’s environment minister said late last week, rejecting calls for an earlier increase.

“We promised industry and we promised British Columbians that there wouldn’t be a change until 2018, and there won’t be,” Mary Polak told CBC Radio on Friday, responding to calls from several BC mayors to raise the rate before 2018 and a coalition of northeastern municipalities to leave it as is.

BC Premier Christy Clark last month said she was considering raising the tax but offsetting it with tax cuts elsewhere, several media sources reported, but it was unclear whether that would be before or after the scheduled July 2018 end of the freeze.

Polak said that increasing the levy to $40 would push the province towards “uncharted territory”, adding that the government must ensure BC businesses “can stay competitive and this can be affordable for people, because it shows up on their gas bills.”

The tax, which covers 70-80% of the province’s economy and was meant to increase annually since it was introduced in 2008, was frozen at C$30/tonne in 2012 until July 2018 over concerns about its impact on consumers and businesses.

INACTION

In late March, a group of more than 130 businesses from across BC urged Clark to commit to raising it by $10/t per year from 2018, up from the previous C$5 annual increments.

The group echoed calls from the province’s Climate Leadership Team (CLT), a task force assembled by the government last year to help it review and build on BC’s existing climate change plan.

But a member of the team last week accused the government of inaction on the issue, noting that emissions were rising despite the nearly economy-wide CO2 tax, which at C$30/t represents the highest carbon price in any of Canada’s provinces.

“They committed that they were going to come out with a climate leadership plan, and it’s been delayed,” said Merran Smith, executive director of Clean Energy Canada.  “What’s most important is we need the government to act. You can’t say you’re a carbon leader if your carbon emissions are going up.”

Polak said the government is working on implementing the panel’s 32 recommendations, but gave no further details.

According to the CLT, BC’s existing emissions reduction target of a 33% cut below 2007 levels by 2020 will be “extremely difficult to meet at this point”, and therefore the province should consider both setting and focussing on hitting a new 2030 goal.

The future of the carbon tax may also be affected by the results of BC’s May 2017 provincial election.

By Mike Szabo – mike@carbon-pulse.com