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Sask. Court of Appeal rules federal carbon tax is constitutional

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Sask. Court of Appeal rules federal carbon tax is constitutional

A slim majority on the Saskatchewan Court of Appeal has ruled that the federal government’s national carbon-pricing system is constitutional.

In a decision issued Friday, the court found that requiring a national price on carbon pollution fell within federal jurisdiction under the national concern branch of its peace, order and good government (POGG) power stipulated in the Canadian Constitution. This allows the federal government to legislate on matters of national importance that have a “singleness, distinctiveness and indivisibility” that clearly distinguishes them from distinctly provincial issues.

“The Greenhouse Gas Pollution Pricing Act is not unconstitutional either in whole or in part,” reads the ruling from the majority.

The decision was supported by three justices on the court while the remaining two offered a dissenting opinion concluding the act was an invalid exercise of federal power.

Saskatchewan Premier Scott Moe asked for a reference from the provincial court on the constitutionality of the act, which allows the federal government to price carbon pollution in jurisdictions that do not have one that meets Ottawa’s standards.

Shortly after the ruling was issued, Moe said his government would look to appeal it to the Supreme Court.

Ontario Premier Doug Ford’s government has launched a similar reference case that heard arguments last month. Court challenges of the act are also ongoing in Manitoba and New Brunswick, and Alberta will likely join the fray under its new United Conservative Party government, led by staunch carbon tax critic Premier Jason Kenney.

Moe likened Friday’s ruling to losing the first game of a playoff series. There are still opportunities to win the case in the court challenges lead by other provinces that oppose the tax, he said, with the Supreme Court acting as the ultimate “game seven.”

Speaking to reporters in Ottawa, Environment Minister Catherine McKenna lauded the decision as confirming the federal government’s authority to impose a price on carbon and chided conservative provincial governments for failing to address climate change.

She asked when the provincial governments opposing the carbon price would “stop the partisan games and join in on serious and effective climate action.”

Saskatchewan argued before the court that the act violated the Constitution because it concerned property and civil rights, and other purely local issues that fall under provincial jurisdiction. The province also said it breached the constitutional principle that only legislatures can impose taxes as the executive branch would determine what jurisdictions it would apply.

Lawyers for the federal government said the act was a valid exercise of Parliament’s power under the POGG principle and argued for Ottawa to have jurisdiction over “the cumulative dimensions of GHG (greenhouse gas) emissions,” which the court rejected on the grounds that it could upset the balance of powers under federalism and would hamper provincial efforts to slash emissions.

Instead, the court said Parliament has the authority to establish minimum national standards on emission prices because it gives the provinces “broad scope” to legislate GHG emissions and has the narrow and distinct purview required under the national concern power.

The majority on the court rejected Saskatchewan’s argument that the act violated the constitutional principle on federalism, ruling that it’s “not a free-standing concept that can override an otherwise validly enacted law.” It also concluded that the levies imposed under the act are regulatory charges not taxes and Parliament, by passing the law, has authorized the federal cabinet to determine where it applies.

The majority ruling noted that GHG emissions “do not respect provincial boundaries” and the failure of one province to take action to slash emissions would impact other provinces. It said climate change is a global problem that calls for a “global response” that can only be effectively produced from “state-to-state negotiation and agreement,” like the Paris Agreement that Canada and 200 other countries signed in 2015 to keep global temperature increases to below 2 degrees.

In participating in these sorts of global pacts, Canada is expected to make national emission reduction commitments that are “self-evidently difficult for Canada, as a country, to meet if not all provincial jurisdictions are prepared to implement GHG emissions pricing regimes,” reads the majority ruling. It noted that these pricing regimes “are an essential aspect of successful GHG mitigation plans,” based on the record before the court.