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Carbon taxes were enacted on a false premise, that economists can design carbon taxes that lower emissions at the least possible cost

Simply put, carbon taxes were enacted on a false premise: That economists can design carbon taxes that lower emissions at the least possible cost while shielding the economy from the drag of an added tax. And they surely can — on a blackboard.

One could design a carbon tax that’s revenue neutral, that supplants carbon-limiting regulations, that starts at the social cost of carbon, properly deflated for the cost of raising funds and the discount of the future value of funds. That model is well established, but that’s not how we implement carbon taxes in Canada. Here, carbon taxes have become simply a tax-and-spend model that lets governments spend ever more trying to pick winners and losers in the energy sector.

That’s one reason why Ontario Premier Doug Ford, Alberta UCP Leader Jason Kenney, Saskatchewan Premier Scott Moe and others have called for ending carbon tax mandates in Canada, and for repealing current carbon-pricing systems in Ontario and Alberta. Now it’s time for the Trudeau government to admit that its proposed carbon tax will significantly burden families across Canada today for a climate benefit too small to measure by 2100.

It’s time to unwind carbon pricing and focus instead on where we can reduce greenhouse gas emissions by, for example, facilitating natural gas production and transport and by investing in fundamental research and development to find lower-emission ways to generate energy that are less expensive than affordable alternatives such as natural gas, oil and coal.

Kenneth Green is senior director of natural resource studies at the Fraser Institute.

Editor’s note: This article has been updated. The $50-per-tonne carbon-price model used by Winter that is referenced in this article was prepared prior to the details of the tax proposals from the Trudeau Liberal government being revealed. The original version of this op-ed was worded in a way that could leave the impression that Winter’s calculations were based on the specific carbon-tax proposals that were subsequently put forward by the Liberal government.