Carbon price not exempt from GST

Ottawa doesn’t intend to account for GST revenues in its rebate program

The federal government’s impending national carbon price could bring in more than $250 million in GST revenues next year but Ottawa doesn’t intend to account for those funds in its rebate program.

A 2017 analysis by the Library of Parliament said that if the GST were charged on all of the revenues collected from existing carbon levies in British Columbia and Alberta it would add as much as $150 million to Ottawa’s coffers.

The same analysis applied to the $20-a-tonne carbon levy Ottawa will impose on Saskatchewan, Manitoba, Ontario and New Brunswick next April suggests the GST on the federal levy in those provinces could be as much as $118 million a year.

RELATED: B.C. carbon tax now costs more than natural gas it is charged on

The parliamentary researchers warned that the final tally will depends on what costs are passed on to consumers from businesses. Also, some items, such as basic groceries and pharmaceuticals, are exempt from GST, so if the carbon levy raises their prices it won’t lead to more sales-tax revenue.

The federal government promises the carbon levy will be revenue-neutral but the Liberals have already defeated a private member’s bill from Conservative MP Mark Warawa that would have exempted the carbon levy from the GST.

RELATED: Carbon tax, sales tax breaks finally make B.C. LNG happen

A spokesman from Finance Canada says the government doesn’t believe the revenues from the GST will alter the government’s take much because the money consumers spend on the GST on carbon levies would likely have just been spent on other taxable goods.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Two Courtenay Habitat for Humanity families receive keys to new homes

Lake Trail Road project officially has residents

Preparations ongoing for Courtenay’s annual Earl Naswell Community Christmas Dinner

The doors of the Florence Filberg Centre, downtown Courtenay, will open again… Continue reading

Valley woman found guilty on three charges following 2016 collision in Courtenay

The woman involved in a trial for a multi-vehicle collision in which… Continue reading

High winds force several BC Ferries sailing cancellations

Tsawwassen to Swartz Bay, Horseshoe Bay to Departure Bay, and Duke Point to Tsawwassen among closures

VIDEO: Royals reveal the images on their Christmas cards

Prince William and his wife Kate are shown outside in casual clothes, their three young children in tow

Media, robotics, Indigenous studies coming to B.C. Grade 12 classrooms in 2019-20

Provincial tests are also being changed for students in Grade 10 to 12, the Education Ministry said

ICBC to apply for 6.3% hike to basic insurance rates

Crown Corporation said it will be submitting its next basic rate application to the British Columbia Utilities Commission Friday

Stranded B.C. trucker writes final wishes before being rescued 3 days later

‘I was just praying someone would come along’

Canfor Corp. extending temporary curtailment of sawmills in B.C.; cutting hours

Vancouver-based company says the decision is due to declining lumber prices, high log costs and log supply constraints

Canada’s prospective world junior team members await final roster decisions

Thirty-four players were invited to the national junior selection camp

Family searching for B.C. professor last seen at Colombian salsa club

Ramazan Gencay, a professor in economics at Simon Fraser University, was last seen in Medellin

Rash of bomb threats a learning opportunity for response capacity, Goodale

Thursday’s wave of bomb threats swept across communities on both sides of the Canada-U.S. border

Mike Duffy can’t sue Senate over suspension without pay, judge rules

Duffy’s lawsuit sought more than $7.8 million from the upper chamber

Most Read