FOR IMMEDIATE RELEASE
March 22, 2017
Alex Doukas, alex[at]priceofoil.org, +1 202 817 0357
Adam Scott, adam[at]priceofoil.org, +1 416 347 3858
Trudeau Government finally getting the message on fossil fuel subsidies: Oil Change International
Today, the Trudeau Government is finally starting to make good on their promise to phase out dangerous fossil fuel subsidies. The Trudeau Government is taking its first concrete actions to fulfill campaign promises to end handouts to oil and gas companies in line with Canada’s commitment under the G7 and G20.
In response Alex Doukas, Senior Campaigner at Oil Change International, released the following statement:
“Today’s budget finally starts to chip away at the $1.6 billion in public money the federal government gives to oil and gas companies each year. The government estimates its plans to reduce handouts to oil and gas companies will save taxpayers roughly $150 million through 2022.
“But the Trudeau government will need to do more to fulfill its promises: as the impacts of climate change accelerate, it feels more and more like our home is burning. Continuing to hand out public money to fossil fuel companies is like spraying jet fuel on the fire.
“Today’s step to reduce handouts to oil and gas corporations is undoubtedly positive, but the government should work quickly to release a plan and timeline to phase out Canada’s remaining fossil fuel subsidies.”
“Fossil fuel subsidies pull in the opposite direction of a carbon price. Continued subsidies to oil and gas companies yank the rug out from under Trudeau’s nation-wide price on carbon. Today’s budget claws back some of the money taxpayers fork over to oil and gas companies each year, but we’re still paying polluters to pollute.
“Canada has a long way to go in demonstrating it understands the scale of the climate challenge. These early steps are encouraging, but Prime Minister Trudeau’s stubborn refusal to reject new fossil fuel infrastructure is holding him back from being the climate leader Canada needs.”
- According to recent analysis, subsidies to oil, gas, and coal producers in Canada average $3.3 billion per year, $1.6 billion of which are subsidies from the federal government (the remainder from provincial and territorial governments).
- The budget begins to address federal fossil fuel subsidies by trimming tax benefits that incentivise oil and gas production – most significantly, the Canadian Exploration Expense tax provision, as well as the tax treatment of flow-through shares (see the summary table on p.6 of the Tax Measures: Supplementary Information budget document)
- An analysis published last year showed Canada’s continued subsidies to fossil fuel production could undermine plans to price carbon across the country. The analysis found that federal and provincial subsidies to fossil fuel producers were equivalent to paying polluters $19 / tonne of CO? to pollute.
- The Trudeau government promised to phase out fossil fuel subsidies in line with Canada’s G20 commitment (p.81 of the 2015 Liberal Party of Canada platform), and committed at the 2016 G7 and North American Leaders’ Summits to phase out fossil fuel subsidies by no later than 2025.