07 June 2007

Quebec's carbon tax may just work

Quebec has announced it will implement Canada's first carbon tax in October. The tax will be applied to gasoline, diesel fuel and heating oil at just under a penny a litre and collected from petroleum companies.

Natural Resources Minister Claude Bechard said he hopes the companies will pay the tax without passing the cost on to consumers.
If Mr. Bechard's vain hope was somehow fulfilled, and the companies absorbed the cost themselves, the tax would do nothing to discourage people from driving. The minister is quoted as saying, "Every Quebecer has a responsibility." He then institutes a tax that is designed to relieve every Quebecer except the petroleum companies of that responsibility.

But of course Mr. Bechard is just playing politics. He knows full well
the companies will pass the cost on to the consumer. They pass all their costs on to the consumer.

So, despite Mr. Bechard's political gamesmanship, the tax will add to the cost of gasoline and should therefore discourage driving. The more someone drives, the more they pollute, and the more they will pay. Each will be accountable, each will pay for his or her own mess. Just as it should be.

If the $200 million a year the tax is expected to raise goes toward energy-saving initiatives such as public transit, as the Quebec government promises, it will be a model and a challenge for the rest of the country.

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