Trudeau’s Contentious Carbon Tax Loses Support as NDP Pulls Back

(Bloomberg) -- Prime Minister Justin Trudeau’s federal carbon tax lost more support on Thursday after New Democratic Party leaders opened fire on the way he has implemented the levy.

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Federal NDP Leader Jagmeet Singh said on Thursday that his party disagrees with Trudeau’s approach of exempting fuels favored in certain provinces and that he wants a policy that doesn’t “put the burden on the backs of working people, where big polluters have to pay their fair share.” The NDP will release its plan in the next few months, Singh said.

Singh has previously voted in favor of the carbon tax, but earlier this month he pulled out of a deal supporting Trudeau’s Liberal Party in government, raising the chance of an early national election. The election is currently due by October 2025.

British Columbia Premier David Eby was formerly a rare ally for the tax, but also withdrew his support in a separate press conference later Thursday. He said that BC would end the carbon tax for consumers, while ensuring “big polluters pay the carbon price” to tackle climate change, if Ottawa would let it do so by removing the federal backstop. BC’s projected carbon tax revenue for the current fiscal year is C$2.6 billion ($1.9 billion).

In March, Eby rejected a request from federal opposition leader Pierre Poilievre, of the Conservative Party, to fight an increase in the carbon price. But on Thursday Eby blamed the Liberal government for “politicizing” the tax with large hikes and granting exemptions for certain products in certain provinces. Eby is now facing what polls suggest is a close reelection battle against the provincial Conservative party next month.

Eby spoke alongside Manitoba Premier Wab Kinew, also of the NDP, who’d already expressed reservations about the tax earlier in the year. The government has to be flexible to make life more affordable for Canadians amid high inflation and interest rates, he said.

“I’m worried that the politicization of this issue is causing us to lose a generation of Canadians, causing us to lose so many people from the blue collar, and we can’t afford that,” Kinew said.

Poilievre, who has a large lead over Trudeau in the polls, has said he wants a “carbon tax election” and has for months campaigned on the slogan “Axe the Tax.” The NDP’s Singh drew a line between their two positions by claiming the federal Conservatives simply wanted free rein for big polluters.

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