Provinces’ lawsuit against Trudeau’s carbon tax argues it is unconstitutional

Last week lawyers representing the provincial government were in a Regina courtroom for two days of hearings as Saskatchewan opposes the Prime Minister Justin Trudeau’s threat to force a carbon tax on the province and plans to argue it is unconstitutional because it’s not applied evenly in all jurisdictions. The Saskatchewan government has asked the province’s Appeal Court to rule on whether a federally imposed tax is constitutional. Arguments were given to a panel of five judges, including from sixteen interveners on both sides of the dispute.

The governments of New Brunswick, Ontario, and Alberta’s Opposition United Conservative Party were among the presenters supporting the Saskatchewan government. The government of Ontario, which has filed its own legal challenge. Applicants in support of the federal government’s position include the government of British Columbia, The David Suzuki Foundation, and the Athabasca Chipewyan First Nation.

Meanwhile, the Prime Minister was in Saskatchewan announcing a major green energy investment. Shifting the language from “carbon tax” to “price on pollution”, Prime Minister Justin Trudeau had previously said, “Our focus on bringing forward a price on pollution is very simple; there is too much pollution in our atmosphere, because for too long pollution has been free.” Ottawa says the constitution gives it the power to impose a carbon price because climate change and greenhouse gas emissions are national concerns.

Saskatchewan Attorney General Don Morgan has said challenging the constitutionality of Ottawa’s carbon tax is the right thing to do for his province’s residents and its energy sector. University of Alberta law professor Eric Adams said he expects where Saskatchewan will want to keep the court focused on the federal-provincial division of powers, Ottawa is likely to steer its argument towards the issue of climate change itself. “There’s no question that it’s a monumental decision in the life of the Canadian Constitution. The court hasn’t yet grappled explicitly with climate change as the background context to a constitutional question,” Mr. Adams said.

Starting this April, the federal government’s carbon price starts at a minimum at $20 a tonne and rises $10 each year until 2022. Saskatchewan, New Brunswick, Ontario, and Manitoba are without a carbon pricing plan and will therefore be subject to the carbon tax. The government’s Saskatchewan Party has always been opposed to the idea of a carbon tax, which the province says would hurt the economy and regardless believes its own plan for emissions reductions goes above and beyond what will be mandated federally. Prime Minister Trudeau said greenhouse gas emissions do not observe political borders and the environment is federal responsibility. Saskatchewan argues it is unconstitutional to impose a tax on some provinces, but not others.

In court filings, both Canada and Saskatchewan point to the Constitution to show that neither the province nor the federal government has explicit control over the environment, but that it overlaps both jurisdictions. Saskatchewan argues a federally imposed carbon tax is “constitutionally illegitimate” because it only applies to some provinces: “Under our Constitution the federal government has no authority to second-guess provincial decisions with respect to matters within provincial jurisdiction.

Ottawa argues climate change is a national concern and the federal government’s power to impose a carbon tax comes from Section 91 of the Constitution, which states laws can be made “for the peace, order and good government of Canada.” Mr. Adams said that branch of jurisdiction is not often cited in constitutional disputes because it’s difficult for courts to define the limits of a “national concern.

Last week, Saskatchewan released regulations under Prairie Resilience that will require industry to reduce methane emissions by 4.5 million tonnes annually by 2025, including penalties for non-compliance. Prairie Resilience focuses on performance standards for heavy emitters and growing renewable power generation. The federal government accepted the provisions of Prairie Resilience when announcing the carbon tax framework, but still said all pollution needs to be priced. “Our plan is actually broader based and more comprehensive than anything that the federal government has put forward,” said Innovation Minister Tina Beaudry-Mellor, adding, “I think Saskatchewan people want to see we are standing up for very important resource industries in this province.