Mr. Speaker, in response to (a), while there is no commonly held definition, there has been a general understanding that fossil fuel subsidies encompass price controls, cash subsidies and tax preferences—i.e., concessions from a particular country’s “normal” level of taxation—whether aimed at producers or consumers of fossil fuel. The term “inefficient” fossil fuel subsidies also lacks a commonly accepted definition and was not defined in any of the four pairs of G20 peer reviews completed to date. Environment and Climate Change Canada and Finance Canada are working to finalize an assessment framework that will define these terms in the Canadian context.
In response to (b), there is a clear cost from a changing climate, so it cannot be free to pollute. That is why the Government of Canada introduced a price on carbon pollution across Canada in 2019. Putting a price on carbon pollution reduces emissions and encourages innovation, allowing Canada to meet its economic needs and its environmental goals at the same time. The price on carbon pollution is currently $40 per tonne. It will increase annually until it reaches $170 per tonne in 2030. The increasing price will make cleaner options more affordable and discourage pollution-intensive investments.
As the Supreme Court of Canada confirmed, the Government of Canada’s carbon pricing system is not a tax.
Carbon pricing is a key part of the government’s approach to reducing emissions while supporting the transition to a competitive, low-carbon economy. It is not the only measure being used, however, and the government has therefore not projected what carbon price would be needed in the absence of other measures to achieve either its 2030 national determined commitment of 40% to 45% reduction below 2005 levels or its goal of net-zero emissions by 2050.
In response to (c), the actions taken by this government to address climate change, including through the strengthened climate plan and the important announcements made at COP26, are designed to reduce greenhouse gas emissions and build resilience to the harmful effects of climate change while growing our economy. The environment and the economy go hand in hand.