The report also said that, “broadly speaking,” its analysis showed larger net gains and lower net household costs than its previous study did”.
Bitwhys2003 on
First of all if the reduction in GDP is fuel savings that’s the whole point.
I can’t sus it out. Is the rebate being turned back into the economy or is it written off as an expense?
I find it hard to believe the 10% being drawn off for programs is that much of a drag on the system. Even then it’s being spent which contributes to GDP
CardiologyGuy2 on
Largely the same? What?
“It’s estimate of net costs from the carbon tax were much lower than in the previous report. Previously, the PBO said the average net cost for a household in Alberta was $2,773 in 2030-2031. In its new report, that cost is now $697.”
That’s quite a different story I would say. That’s almost a fourth of what it was before.
“Considering only the fiscal impact of the federal fuel charge, PBO estimates that the average household in each of the backstop provinces (that is, all provinces except Quebec and British Columbia) **in 2030-31 will see a net gain,** **receiving more from the Canada Carbon Rebate than the total amount they pay in the federal fuel charge (directly and indirectly) and related Goods and Services Tax.**”
“Moreover, in 2030-31, for all backstop provinces, **we estimate that the average household in each income quintile will see a net gain**—except for the average household in the highest income quintile in Prince Edward Island, Nova Scotia and New Brunswick—when only the fiscal impact of the federal fuel charge is considered”
“**We estimate that the largest net gain in 2030-31 is for the average household in the lowest income quintile in Saskatchewan (4.5 per cent of disposable income**); the largest net cost in 2030-31 is for the average household in the top income quintile in Prince Edward Island (0.1 per cent of disposable income).”
“In 2030-31, **accounting for both fiscal and economic impacts, we estimate that the largest net gain is for the average household in the lowest income quintile in Saskatchewan (4.0 per cent of disposable income)**; the largest net cost is for the average household in the top income quintile is also in Saskatchewan (1.8 per cent of disposable income).”
“PBO’s counterfactual scenario without carbon pricing should not be seen as an alternative policy option of “doing nothing” such that if the economic impact of carbon pricing is negative then it should be jettisoned, and the Government should adopt a do-nothing approach to reduce Canada’s GHG emissions.”
“**We estimated that the level of Canadian real GDP in 2100 would be approximately three-quarters of a percentage point lower compared to the baseline scenario in which all countries fully met their climate commitments**. The report, however, noted **that our estimate likely understates the negative impact on GDP** “given that it does not capture exceptional increases in severe climate events that scientists warn would occur as global temperatures rise significantly above key thresholds.””
“PBO has also noted that Canada’s primary means of limiting the economic costs of climate change are through participation in a globally coordinated emissions reduction regime. This does not mean that Canada should be a “free rider” and “do nothing” to reduce its own emissions. Rather, by significantly reducing its own GHG emissions, Canada will actively contribute to the collective effort to limit the impacts of climate change.”
3 Comments
“Thursday’s [updated report](https://www.pbo-dpb.ca/en/publications/RP-2425-017-S–distributional-analysis-federal-fuel-charge-update–analyse-distributive-redevance-federale-combustibles-mise-jour) from the Parliamentary Budget Officer (PBO) found that — considering the average household cost of paying the consumer fuel levy, the GST that’s charged and the indirect costs from the carbon tax — on average, households will see a net gain in 2030-31.
The report also said that, “broadly speaking,” its analysis showed larger net gains and lower net household costs than its previous study did”.
First of all if the reduction in GDP is fuel savings that’s the whole point.
I can’t sus it out. Is the rebate being turned back into the economy or is it written off as an expense?
I find it hard to believe the 10% being drawn off for programs is that much of a drag on the system. Even then it’s being spent which contributes to GDP
Largely the same? What?
“It’s estimate of net costs from the carbon tax were much lower than in the previous report. Previously, the PBO said the average net cost for a household in Alberta was $2,773 in 2030-2031. In its new report, that cost is now $697.”
That’s quite a different story I would say. That’s almost a fourth of what it was before.
Keep the carbon bonus
Here’s the report for anyone curious: [https://distribution-a617274656661637473.pbo-dpb.ca/a019e3958622ad6063532c48ff972c24bbc9477b82af73e6ec5d93d208262b88](https://distribution-a617274656661637473.pbo-dpb.ca/a019e3958622ad6063532c48ff972c24bbc9477b82af73e6ec5d93d208262b88)
“Considering only the fiscal impact of the federal fuel charge, PBO estimates that the average household in each of the backstop provinces (that is, all provinces except Quebec and British Columbia) **in 2030-31 will see a net gain,** **receiving more from the Canada Carbon Rebate than the total amount they pay in the federal fuel charge (directly and indirectly) and related Goods and Services Tax.**”
“Moreover, in 2030-31, for all backstop provinces, **we estimate that the average household in each income quintile will see a net gain**—except for the average household in the highest income quintile in Prince Edward Island, Nova Scotia and New Brunswick—when only the fiscal impact of the federal fuel charge is considered”
“**We estimate that the largest net gain in 2030-31 is for the average household in the lowest income quintile in Saskatchewan (4.5 per cent of disposable income**); the largest net cost in 2030-31 is for the average household in the top income quintile in Prince Edward Island (0.1 per cent of disposable income).”
“In 2030-31, **accounting for both fiscal and economic impacts, we estimate that the largest net gain is for the average household in the lowest income quintile in Saskatchewan (4.0 per cent of disposable income)**; the largest net cost is for the average household in the top income quintile is also in Saskatchewan (1.8 per cent of disposable income).”
“PBO’s counterfactual scenario without carbon pricing should not be seen as an alternative policy option of “doing nothing” such that if the economic impact of carbon pricing is negative then it should be jettisoned, and the Government should adopt a do-nothing approach to reduce Canada’s GHG emissions.”
“**We estimated that the level of Canadian real GDP in 2100 would be approximately three-quarters of a percentage point lower compared to the baseline scenario in which all countries fully met their climate commitments**. The report, however, noted **that our estimate likely understates the negative impact on GDP** “given that it does not capture exceptional increases in severe climate events that scientists warn would occur as global temperatures rise significantly above key thresholds.””
“PBO has also noted that Canada’s primary means of limiting the economic costs of climate change are through participation in a globally coordinated emissions reduction regime. This does not mean that Canada should be a “free rider” and “do nothing” to reduce its own emissions. Rather, by significantly reducing its own GHG emissions, Canada will actively contribute to the collective effort to limit the impacts of climate change.”