Name ONE Part of the Environment That Was Conserved By Carbon Taxes

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New fuel regulations set to take full effect in 2030 are expected to increase the price of fuel and shrink the size of Canada's economy, according to a new report from Canada's budget watchdog.

The Parliamentary Budget Officer (PBO) released a distributional analysis of the federal government's Clean Fuel Regulations Thursday.

After its release, the report became a lightning rod for federal politicians, with the Conservatives calling the policy a financial burden on families.

The other political parties criticized the PBO because they said the analysis ignores the cost of inaction on climate change.

The Clean Fuel Regulations take effect in July.

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The analysis also finds that the Clean Fuel Regulations, also known as Trudeau’s second carbon tax, will hit lower income families much harder.

“Since lower income households generally spend a larger share of their income on transportation and other energy-intensive goods and services compared to higher income households, on average the Clean Fuel Regulations will have a greater impact on these households,” said Yves Giroux, the PBO.

The Clean Fuel Regulations are part of the Trudeau government’s overall plan to reduce greenhouse gas emissions. While the government doesn’t describe the regulations as a tax, the effect of the regulations is the same — a fee is levied by government for a policy reason.

Like the “price on carbon,” these regulations are a tax by any other name.

On average, the report from the PBO says that by 2030, lower income households will be paying an extra $230 per year, or 0.62% of their disposable income due to the new tax. Higher income households will be paying an additional $1,008 which is a higher amount but at 0.35% of their disposable income, represents a much lower impact on spending.

“Relative to household disposable income, PBO results show that the Clean Fuel Regulations are broadly regressive. That is, the cost to lower income households represents a larger share of their disposable income compared to higher income households,” the report states.

Where you live also has an impact on how hard Trudeau’s second carbon tax will hit your wallet.

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In Ontario, the estimate is the bottom 20% of income earners will pay an additional $217 by 2030 while the top 20% will pay an average of $495 extra. In Quebec, the extra costs will range from $178 to $436, while in Manitoba the range is from $237 to $611.

In Alberta and Saskatchewan, the costs are much higher “reflecting the higher fossil fuel intensity of their economies.”

By 2030, the bottom 20% of income earners in Saskatchewan will pay an extra $38 per year while the top 20% will pay an additional $1,117. In Alberta, the range is from $370 to $1,157. ...

According to the Office of the Superintendent of Bankruptcies, insolvencies were up by 28% in March, the last period reported on. Food bank use is climbing across the country and now Trudeau will add a new “charge” that will add direct costs for Canadians and also indirect costs to the goods they buy.

Earlier this year, the PBO released a report that said the total impact of the carbon tax was higher than the Trudeau government was claiming.

“Based on our analysis, most households will pay more in fuel charges and GST — as well as receiving slightly lower incomes — than they will receive in Climate Action Incentive payments,” the report said.

When the analysis of the two reports is combined, a middle-income family in Ontario will be paying $1,771 per year more due to both charges by 2030. In Manitoba, that combined tax increase amounts to $1,130, while in Saskatchewan it works out to $1,213 annually and $1,859 in Alberta.

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The PBO report on the Clean Fuel Regulations states that by 2030, the additional costs will add 17 cents per litre for gasoline and 16 cents for diesel. Unlike the original carbon tax, there are no rebates for the increased costs imposed by the Clean Fuel Regulations.

“So there’ll be carbon tax one, then carbon tax two, and then HST on carbon tax one and two, all of which will cost you 61 cents a litre in higher Trudeau taxes every time you gas up to go to work,” Poilievre said, adding the new regulations will increase the costs for home heating and groceries.