UPDATED: Alberta takes Ottawa to court over 'unfair' carbon tax exemption for heating oil

The Alberta government said it has filed an application for a judicial review of the home heating oil exemption to the Canadian government’s carbon tax in the Federal Court of Canada. In this application, the Alberta government has asked the Federal Court to declare the exemption unconstitutional and unlawful. The exemption benefits Quebec and Atlantic Canada the most, as they have the largest share of people using home heating oil. “We hope this will force Ottawa to recognize the burden the carbon tax places and eliminate the tax altogether,” said Alberta Premier Danielle Smith at a Tuesday press conference. “Albertans know we got their backs on this.” The Alberta government has been fighting the carbon tax since 2019. It took it to the Supreme Court of Canada in 2021. Smith pointed out the carbon tax was wrong when it was made into law and is wrong now. While it was always unfair, she said the selective way it is being applied now is unconstitutional, as it offers relief to Quebec and Atlantic Canada the most while leaving Alberta and other provinces with higher heating costs. As the costs continue to increase, she said the impact on Albertans will worsen. The Canadian government has said the exemption was intended to lower energy bills for people who use home heating oil. In effect, she said it is saying some Canadians deserve lower energy bills and others do not. She accused it of admitting the carbon tax raises costs for households. She said the carbon tax is adding to inflation. In fact, the Bank of Canada said it increases inflation by 0.15% per year year over year. The Canadian government said the carbon tax on fuel will be 39.6 cents per litre by 2030. If it follows through, the Canadian Energy Centre projected it will account for 24% of annual fuel costs. She called for people to imagine the savings if their bills were one-quarter less. If the Canadian government is now saying that removing the carbon tax on home heating oil will lower costs, she said the exemption for Eastern Canada “blows a big hole in their justification for the carbon tax.” Because it is being applied unequally, she said it is unconstitutional and runs contrary to the Canadian government’s carbon tax legislation. She said the Alberta government's end goal is to get rid of the carbon tax. If the Canadian government will not axe the tax, Smith said it “can at least play fair when imposing it on Canadians.” That is what it will be heading back to court to achieve. Alberta Justice Minister Mickey Amery said the Canadian government continues to act outside the law and needs to be held accountable. “Alberta has stepped up to do just that,” said Amery. “The federal government’s carbon tax exemption for heating oil is both unconstitutional and unlawful.” Amery alleged the exemption is unconstitutional because it applies a supposed national standard in an unfair, inconsistent manner to benefit certain areas. Additionally, he said it is unlawful because the Canadian government’s actions are inconsistent with their stated purpose. Smith followed up by saying the Canadian government should repeal the carbon tax. “We’ve been calling for that for years,” she said. “The retail carbon tax is just punitive to taxpayers.” In Alberta, she said people need gas and diesel to get around. To heat homes, she acknowledged they need natural gas. Alberta NDP leader Naheed Nenshi responded by saying it is clear Smith does not think Conservative leader Pierre Poilievre will win the next election if she is tying up the province in court for so many years on another unwinnable case. “I’m no lawyer, but the Supreme Court has ruled that the carbon tax is constitutional,” said Nenshi.“Certainly, the federal government really dropped the ball in creating the carve out for home heating oil.”Nenshi said the Alberta government chooses to fight rather than make a deal with the Canadian government, talk about an exemption for natural gas or give more rebate money to Albertans wanting to get on home heating oil. Moreover, he said the most telling part about her press conference was when she was asked if she talked to the Canadian government and her response was asking why she would do that.The Canadian Taxpayers Federation (CTF) applauded Smith for launching a renewed constitutional challenge against the carbon tax. “The carbon tax is making the necessities of life in Alberta more expensive and that’s why Smith is right to take Prime Minister Justin Trudeau’s carbon tax back to court,” said CTF Federal Director Franco Terrazzano. “Last time the carbon tax fight went to the Supreme Court, the federal government argued it needed a national carbon tax to deal with a national problem.”However, Terrazzano said the Canadian government undercuts its argument for a federal carbon tax by making an exception for home heating oil, which favours Atlantic Canada. Since Prime Minister Justin Trudeau torpedoed his own constitutional argument for imposing a carbon tax, he pointed out it is time to challenge it in court again. Trudeau said in 2023 there will be changes to the carbon tax to help people in rural areas and those who use heating oil to heat their homes..Trudeau drops carbon tax on heating oil, increases rebate for Atlantic Canadians.“Today’s announcement is good news for Atlantic Canadians, rural Canadians and people across the country,” said Trudeau.“We are putting more money back into your pocket and making it easier for you to find affordable, long-term solutions to heat your home.”

UPDATED: Alberta takes Ottawa to court over 'unfair' carbon tax exemption for heating oil

Related Stories