Commentary: What will the carbon tax mean for non-profits?

Hannah Zimmering, Bill Thomas & Charlotte Hrenchuk

On behalf of members of the Yukon Anti-Poverty Coalition, we would like to raise a number of concerns regarding the proposed framework for carbon tax rebates. Below are five recommendations we hope will be considered before making a final decision on how the carbon tax program will roll out:

Include non profits and social enterprises with the business category as being eligible for a rebate.

When the public was asked what groups should be targeted for a higher rebate, NGOs and charities were in the top three responses. It is interesting that the other groups to be targeted (those taking green action and small businesses) have been included for the rebate, yet NGOs and social enterprises were not included. We hope this oversight will be rectified.

We are concerned that if not included, individuals and not for profits will be dissuaded from developing new social enterprises in the Yukon. We are also worried that non-profits that offer community service will be adversely affected and thus, their clients will also feel the negative impact of the current carbon price framework.

Not for profit social enterprises that operate as businesses will be paying the carbon tax yet not be eligible for a rebate. This will hamper their operations and also have an impact on the social service that they may be providing. For example, in the past, the Salvation Army Thrift Store shipped textiles to southern recyclers for profit on a regular basis.

If the carbon tax had been in place during the time of their operations, they would be losing money which would have an impact on the services they were able to provide. We are concerned that other social enterprise, like the Love2 Thrift Community Thrift Store, could see similar repercussions. Other social enterprises that could see an impact are Challenge and the Potluck Food Co-Op.

On the non-profit front, food for the food bank is often shipped up from Calgary and Edmonton. They will pay the cost of the increased price of fuel, but will not see any rebate. Any benefits the community might see with food shipped from southern Canada, will quickly disappear if that money is then used to pay the carbon levy. The Outreach Van is another good example of the impact of a carbon levy with no rebate being offered.

Ensure the carbon price rebate recognizes the impact on low and modest income earners.

Similar to BC and Alberta, the benefit should be progressive so that the majority of the benefit is provided to low- and modest-income households. The current proposed framework will mean that low-income earners pay a higher percentage of their income in tax than do higher-income households, even though higher-income households pay more dollars.

Because low income people often do not file tax returns, relying on the tax system to distribute the benefit to all Yukoners can also negatively affect low income earners as they will not be able to access the rebate.

In the What we Heard Report, many raised the hope that the framework would mitigate the impacts of a carbon price on the most vulnerable Yukoners. In fact, 60% of respondents responded that low income Yukoners should receive a higher rebate than others.

Increase the remote supplement to address equity concerns related to the cost of living outside Whitehorse.

YAPC’s Food Cost Monitoring Study (2017) clearly shows that the cost of healthy eating in remote communities is much more than 10 per cent higher than the cost in Whitehorse. Further, the carbon tax will disproportionately affect food prices in these communities as items have to be shipped over greater distances (even in communities like Teslin and Watson Lake where the trucks first stop in Whitehorse before doubling back down south).

Re-examine the decision to exempt placer miners from the tax.

The decision to exempt placer mines from the tax will result in the annual benefit being an estimated $165 less per person (according to University of Calgary Economist Trevor Tombe who sat on the Premier’s Financial Advisory Panel). If the rebate were designed in a more progressive manner, the benefit would be much greater for low-income households. The current decision suggests that placer miners do not see a role for their industry in reducing the use of carbon intensive fuels.

Make poverty reduction a higher priority across Yukon government.

We recognize that the basic cost of food will rise once fuel is taxed, and feel the framework should be re-examined as part of a more comprehensive approach to reducing poverty much as has been developed in BC and Alberta.

Hannah Zimmering, Bill Thomas and Charlotte Hrenchuk are co-chairs of the Yukon Anti-Poverty Coalition.

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