Thank you. Ms. Green.
Thank you. How does the model of the estimated cost to households relate to COLO? Is it one-to-one or half-to-one? How does it relate? Thank you.
Thank you. Mr. Stewart.
Thanks, Mr. Chair. I guess I want to start with that one by saying, every time you're dealing with an average, obviously, if you're a homeowner, it is going to be a different value than if you're a renter in an apartment, for example. You would have to consider the different types of tenure in a housing situation.
That said, I believe that the COLO impacts, plus the point-of-purchase fuel rebate for carbon tax on heating fuel, actually will put us close to a one-to-one. In fact, we should be able to be slightly over that in terms of the average impacts on households, where we would be able to fully offset that impact. Thanks, Mr. Chair.
Thank you. Ms. Green.
Thank you for that answer. My next question is: the Minister said that either it was this plan or the backstop. Can he tell us, if this plan is not endorsed, how quickly the backstop would be put into place? Thank you.
Thank you. Minister.
Thank you, Mr. Chair. We were able to work with the federal government because the original implementation date was July 1st. Because we were still dealing with our piece of legislation, they agreed to push it off to September 1st because we were working on our approach. They could have, in theory, implemented their federal backstop on July 1st until we had ours sorted out, but we have been working with them through all this, so they gave us until September 1st.
If we are unable to do this implementing our own made-in-the-North approach, then I would assume, we would have to have a conversation, that the federal government would implement their backstop as quickly as possible. Thank you, Mr. Chair.
Thank you. Ms. Green.
Thank you. Given the fact that they will be entering a writ period, as well, would you anticipate that the backstop would be implemented prior to their election? Thank you.
Thank you. Minister.
Thank you, Mr. Chair. We can't know for sure. Our intention is that, once we deal with Bills 42 and 43, if approved by the Legislative Assembly, then our approach would be implemented on September 1st. Then, we would have some other provisions in the second bill that we are dealing with to deal with the interim payments on the cost of living offset. As far as writ goes, we are under the assumption that we are going to work to try and get our piece of legislation passed so our approach would be implemented on September 1st. Thank you, Mr. Chair.
Thank you. Ms. Green.
Just one last question. I didn't make myself clear in that question. I am asking whether the federal backstop would be implemented prior to the federal election in the event that this plan is not endorsed by Members. Thank you.
Thank you. Minister.
Again, I would assume that it would be, but I am also confident that this Legislative Assembly would support an initiative that we feel is better for the people of the Northwest Territories than the alternate. Thank you, Mr. Chair.
Thank you. Next on the list, I have Mr. Beaulieu.
Thank you, Mr. Chair. I guess when you are taxing people, it is difficult to have any positive aspects. However, this bill appears to have best features. The best features of the bill seems to be that we are not taxing heating fuel or aviation fuel. I would like to ask the Minister if that includes hauling aviation fuel and heating fuel. Thank you.
Thank you. Minister.
No, Mr. Chair. That does not because they would be using motor fuel to haul the heating fuel. Thank you.
Thank you. Mr. Beaulieu.
Thank you, Mr. Chair. I guess I was close to the business of hauling fuel into small community as the Minister of Public Works in the last government. A large cost of heating fuel was the hauling of the heating fuel. In addition to that large cost of hauling the heating fuel, sometimes they get a pretty good price buying, I think it is called purchasing off the rack or something. I can't remember the exact term. The hauling of it, the transportation of the diesel fuel was substantial.
I wonder, if we are going to rebate heating fuel at the point it is purchased, each of us, if we are on Facebook, we have Facebook friends. A lot of those guys are saying that this portion of the tax where it is rebated at the pumps or rebated at purchase is not going to be that substantial of a savings because it costs so much to haul it. If we were hauling to Yellowknife, it is a cost, but then we have to haul it from Yellowknife, also. It is okay to haul it to Hay River, but then we have to barge it from Hay River, also. The hauling, the barging, and we are barging it ourselves, I am pretty sure, through MTS. I would like to ask the government or the Minister if there is any consideration for rebating that cost, as well.
We purchase heating fuel, and then there is going to be a carbon tax on it because everybody is in a carbon tax mode. Then we pay for the haul to Hay River, and then there is going to be a carbon tax on the engines that are going to haul it to Hay River. Is there going to be a continuous carbon tax on the transportation of that fuel from Hay River to the point where it is delivered to the small communities? Thank you.
Thank you. Minister.
Thank you, Mr. Chair. Any motor fuel that is burned will be subject to carbon tax. For those who are hauling it, if they have a garage that relies on heating fuel to keep their garage heated, then that part of it is going to be rebated at the pump. Any motor fuel that they use to haul is going to be subject to carbon tax. Then the cost of living offset, which we were discussing earlier, is a way to help residents try to mitigate some of the impact of those costs. Thank you, Mr. Chair.
Mr. Beaulieu.
Thank you, Mr. Chair. Again, I will use the term "best features" of this bill. One of the best features of this bill is the fact that the fuel is rebated at the point of purchase. However, in comparison to all other costs added to that fuel on its way to your house, it becomes very substantial. I guess it is a little bit of a savings at the end, but the fact that hauling the heating fuel, we have no control over it except we have control over hauling it by barge.
I would like to ask the Minister if they contemplated not charging any extra on the cost of moving that fuel once it crosses our borders, that there is no extra cost passed on to the consumer for the hauling of that fuel, especially through barging. I know that the barging will affect one of my communities, Lutselk'e, but it will also affect a lot of communities up the valley. We actually have control over whether or not we are going to add carbon tax on the movement of that fuel by barge. I would like to ask the Minister if the government considered not charging any carbon tax on the movement of that fuel by MTS. Thank you, Mr. Chair.
Thank you. Minister.
Thank you, Mr. Chair. As I said earlier, any type of motor fuel is going to be subject to the carbon tax. I have to point out that with the heating fuel and propane, 100 percent rebate comes to about $9.5 million dollars. That is a substantial amount right there. We worked with Canada. We came up with an approach that we thought would be beneficial. Nobody likes a tax. That is the way a lot of people see this.
What people out there need to understand is that there is going to be a carbon tax regardless. If our approach is not used, there will be a federal backstop, which I believe will be not as good for the people of the Northwest Territories, especially a lot of those living in smaller communities, having to pay a higher cost of living. We were able to work with them to come up with the approach that we thought would be best for the people of the NWT. We need to be quite clear that the carbon tax is going to happen regardless. Thank you, Mr. Chair.
Mr. Beaulieu.
Thank you, Mr. Chairman. I would like to just make a comment and ask another questions. My comment was: it would be good for if our government has gone to the federal government and asked for a complete exemption from carbon tax considering that between ourselves and Nunavut, we probably spend most of the year heating our house. I know that it is August here. I think we are in the middle of August. Our furnaces are on. We are starting now in August, and we are heating our houses until May. That is not normal.
I talked to a guy today who was putting a new fuel tank in my house, and he said to me, he said, "My brother moved to Edmonton, and his total utility bill in Edmonton, where he's got many options of heating his home, is $350 on average," which includes his cable TV. He threw that in. I thought to myself what a difference between what we pay up here and what they pay down south. We are 40,000 people. We are hardly responsible for climate change. We have very little impact on climate change ourselves. Okay? We do our share to reduce, yes, I agree, but I think, per person, we probably produce less greenhouse gases than anybody else, but we are asked to pay more than anyone else. For some reason or other that does not seem fair, and I think that the federal government should be able to see that, as well. What is fair about us being probably the least emitters but we pay the most for carbon tax? I am assuming that Nunavut will pay more, but I wonder if this government would consider, like, we are going to have an election soon, and, if the liberals win, there is going to be a carbon tax, and, if the unthinkable happens and the conservatives win, then we may not have a carbon tax, at all, so this government, I guess, will repeal the carbon tax if it's in place.
I am thinking about that, and I am thinking maybe if we sat down with the government and asked them if we could be exempt in the NWT from the carbon tax totally, at least that share. I mean we cannot do anything about them hauling it. That is true. The Minister is correct in that. I would like to ask the government if they would consider going back to the federal government and asking to have a complete exemption in the NWT. Thank you, Mr. Chair.
Thank you. Minister.
Thank you, Mr. Chair. The reason we are here having this discussion on the carbon pricing and our approach to carbon pricing which would help mitigate the impact on people in the Northwest Territories is because we have already asked the federal government to give us an exemption. Because we are here, you know what their answer was. They were bent on implementing carbon pricing; it does not matter which part of the country you lived in. So the initial discussion we had with the federal government is we just want to be exempt, and, of course, their answer was no. They said, "You guys go back; do some work to tell us what your approach might be," so we did that. We came back. We did a lot of work, and we talked to a lot of people.
Again, I cannot stress this any more importantly. Nobody is a fan of a tax. Nobody is a fan of a tax. I am not a fan of the tax, but these are the cards we have been dealt, and we are trying to put the best hand together to help mitigate the impact on the people of the Northwest Territories. Is it perfect? It could be worked on. We managed to get the aviation exemption because we spoke with the federal government and told them that is one of our high cost drivers; heating fuel, one of the biggest cost factors in the Northwest Territories, especially for those from outside of the capital who are having to deal with the high cost of heating fuel; and motor fuel, they were bound and determined they were going to keep motor fuel as part of it. So we went to them with our approach, and our approach, actually, there is a lot of work that went into it from a lot of people within the Northwest Territories. I understand, Mr. Speaker, that I need to speed up, but this is an important issue, and I want the people out there --
[Microphone turned off] ...so what I will do is I'll allow the Minister to speak, and I will put 10 minutes on the clock for you, just so we are staying within the rules. Minister.
Thank you, Mr. Chair. I am done.
Cheeky today. Thank you, Minister. Next, Mr. Nakimayak.
Thank you, Mr. Chair. I won't be long. Listening to the debate, I won't repeat too much, if anything. You know, my region in the territories has the highest costs of living, likely the highest cost of transportation. One of my questions after listening, this is just a question. Aviation fuel is exempt and heating fuel is exempt. I am wondering if flying in fuel to the communities would bring the cost down as opposed to shipping it by sea. Thank you, Mr. Chair.
Thank you, Mr. Nakimayak. Minister.
Thank you, Mr. Chair. I never thought of that, but I know of a community that does fly a lot of their fuel in, and I don't think you'd want to be paying the prices they pay, and their distance is not as far as the Member's riding. So I have seen that, and that is a creative way of looking at it, but the airline would still have to recover some of their costs, and I do know of a community in Northern Yukon that pays an extremely high cost for their gasoline. Thank you, Mr. Chair.
Thank you. Mr. Nakimayak.
Yes, thank you, Mr. Chair. It might be a good idea to look into buying an airplane, now that we have barges.
---Laughter
Those were my concerns, Mr. Chair. You know, there are a lot of complaints about this, but, at the same time, you know, it's okay, but I do not like it. That is just the way it is. It's going to raise the cost of living, and I am sure the government and the Minister and his staff are doing the best to bring the costs down. Like you said, like everybody says, this is imposing. We cannot mistake this with anything else, any other programs that the government are putting out, but this is a bill in itself. I will support this, knowing that it's going to bring the cost of living up, but, then again, looking at the feds and what they are doing, it would be even higher as it stands right now, so I just want to point that out. Thank you, Mr. Chair.
Thank you. Would the Minister care to respond? Minister.
Yes, thank you, Mr. Chair, and I will be very quick. The easiest thing for this government to do would have been to say, okay, well, we will do nothing. We had a lot of people working on this, trying to mitigate some of the impact, but the easiest thing to do would have been to just sit back, do nothing, and let the federal government put their backstop in. Then this government would have been accused of not doing anything and letting the federal government just come in and impose their backstop on us without trying to work for the people of the Northwest Territories and help mitigate some of those impacts. I believe that is what we did. Again, as I said before, Mr. Chair, is it perfect? It could use some work. I think the Member from Tu Nedhe-Wiilideh was asking before about the election, and, you know, if a new federal government came in and decided that they were going to repeal the carbon tax, well, it's not a tax that we wanted, and we would make amendments to our -- I would assume that the future government would make an amendment to their legislation so quickly it would probably be one of the fastest pieces of legislation ever to go through this Assembly, and rightfully so, and rightfully so. Thank you, Mr. Chair.
Thank you. It looks like we are entering the second round of comments, and I am going to allow it because somehow the Minister was not at his witness table for the first round, so I guess that is just the way it is. Mr. O'Reilly.
Thanks, Mr. Chair. I will trying to keep this short. I agree no one likes to pay taxes, but sometimes taxes are the price of civilization. However, I think what people want to know is that there has been careful consideration of options. Unfortunately, standing committee did not have options to look at. In the plain-language summary of the bill, the federal backstop information that is presented here is based on rural communities in New Brunswick. Can I have some explanation as to why the federal backstop presented in this paper is about rural New Brunswick? Thanks, Mr. Chair.
Thank you. Mr. Stewart.
Thank you, Mr. Chair. The comparison to rural New Brunswick is related to the climate action incentive that the federal government has implemented. They have implemented the backstop in four jurisdictions, I believe. That is the only one where they have adjusted for a more remote and rural population, where they have actually done an increased amount, so we thought that was the fairest comparison. If you were in urban areas of New Brunswick, the amount would have actually been lower. All of the information of this climate action incentive which is similar to our COLO is available on the federal government website, and it does change by jurisdiction, but this seemed to be the only case that I could see in terms of the federal backstop approach where they actually adjusted it for a more rural or remote location, so that is why the comparison was there. Thanks, Mr. Chair.
Thank you. Mr. O'Reilly.
Thanks, Mr. Chair. So, yes, we have got a comparison now between GNWT's approach and what's being done in New Brunswick, so I don't think it's really fair to say that this is what the federal backstop would look like for the Northwest Territories. I just want to make that very clear. The debate, some of the debate, is around that this would cost us less or that the rebates would be larger under the GNWT approach than the federal backstop. This is a federal backstop for New Brunswick. It has nothing to do with us.
The federal backstop that has been negotiated though in the Yukon, this is what it consists of: Yukon individuals; businesses; First Nations governments; municipal governments; and quartz mining operations would get rebates. Yukon First Nation governments are expected to pay about .5 percent of the total tax, but will receive 1 percent of the revenues. Municipal governments will pay 2.5 percent of the total tax, and will receive 3 percent of the revenues. The rebates to individuals are also adjusted so that rebates to individuals living in remote areas of the Yukon will receive a supplement of 10 percent. That's what the federal backstop looks like in the Yukon. The federal government collects the money. It is given to the Yukon government, and they do the rebates through a legislated rebate program. Their rebates are set in legislation.
I just would like to know why our approach couldn't look a little bit more like this with rebates to Indigenous governments to municipal governments, a sliding scale of some sort for people, rebates for individuals who live in remote areas? Why couldn't we have designed a system like this? Thanks, Mr. Chair.
Minister.
