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MLAs likely to begrudgingly pass carbon tax

Minister of Environment and Natural Resources Robert C. McLeod, flanked by ENR Wildlife Director Brett Elkin, announced the rapid decline of the Bluenose-East and Bathurst caribou herds,

Two things were clear in the legislative assembly Thursday: the territory’s made-in-the North carbox tax was set to pass, and no one was happy about it.

Thursday marked the final house discussion before the carbon tax’s slated Sept. 1 roll out. MLAs – including Finance Minister Robert C. McLeod, who shepherded the plan – either derided the tax as a lesser of two evils against a possibly more punishing federal carbon tax if they didn't approve their own, or in the case of MLAs Kevin O'Reilly, Kieron Testart, and Cory Vanthuyne, suggesting it should be scrapped entirely.

If a new federal government came to power and repealed the tax, McLeod told the assembly he assumed a future government “would make an amendment to their legislation so quickly it would probably be one of the fastest pieces of legislation ever to go through this assembly, and rightfully so.”

Finance Minister Robert C. McLeod says if a new federal government takes power, the next assembly will nix the current carbon tax plan. NNSL file photo

The territory’s made-in-the-North plan, an alternative to a proposed federal tax, would price greenhouse gasses at $20 per tonne. That would rise annually until reaching $50 per tonne in 2022. The territory would rebate the carbon tax on heating fuel, which residents would file for at tax time, and aviation fuel would also be exempt.

A cost of living benefit would aim to ease the strain on residents’ paying more at the pump.

However, the mode of transportation for transporting that fuel would still be taxed. Suggesting it may be cheaper to fly-in fuel than shipping it by sea to communities, Nunakput MLA Herbert Nakimayak noted the already high cost of living in his constituency would be adversely affected.

“It might be a good idea to look into buying an airplane, now that we have barges,” he said to laughter.

The plan also aims to hand large emitters like mines a 72 per cent rebate on their taxes,with 12 per cent going into individual trusts. Those large emitters can use the trusts to invest in further greenhouse gas emissions.

Cabinet would manage remaining funds – the limited public reporting of which O’Reilly has repeatedly panned.

“Unfortunately, the bill really does not contain any provisions for any kind of public reporting, and all of the rebates or grants are going to be determined by regulations set afterwards,” he told the assembly, calling it “a made-by-cabinet approach” that lacked consultation.

He, along with Testart and Vanthuyne opposed the plan outright. Testart reiterated criticism that the MLA committee assigned to the plan lacked teeth, and was frustrated at its inability to influence the legislation.

He and O’Reilly also noted there hasn’t been a costed NWT-oriented federal plan that can be compared to the GNWT’s plan. Yellowknife Centre MLA Julie Green added the Yukon worked with the federal government to create its carbon tax plan, which she said had “distinct advantages.”

Despite their objections, the vote is set to pass. That's largely because MLAs Nakimayak, Frederick Blake, Shane Thompson and Danny McNeely all arrived at McLeod’s conclusion: between the feds and the GNWT, the territory’s tax, imperfections aside, would make the best of a bad situation.

Blake told the assembly the tax would be difficult for his region, where a road trip to Inuvik from Aklavik or Tsiigehtchic, could easily cost $150 or $200. The federal elections could be a change of circumstances, he said.

“I believe this is the best plan we have moving forward. Who knows what will happen in the next federal election,” he told the assembly.

As debate continues on the plan, the current assembly must pass it before next Friday, or risk Ottawa imposing a plan after the Sept. 1 deadline.