June 9, 2008 / 5:26 PM / in 9 years

Conservatives slam Liberals on carbon plan

<p>Liberal leader Stephane Dion listens to a question during a news conference in Ottawa June 5, 2008.Chris Wattie</p>

OTTAWA (Reuters) - Even though there's no election in sight, Canada's governing Conservatives have launched attack ads against the main opposition Liberal Party over its plans for a carbon tax.

Liberal leader Stephane Dion plans to make his carbon plan the main talking point of his summer barbecue circuit and possibly a future election campaign -- and the Conservatives clearly want to define the issue before he does.

In the next two weeks Dion plans to unveil his policy -- aimed at curtailing greenhouse gas emissions -- which one Liberal source said would add C$15 billion ($14.7 billion) in taxes on energy, with the idea that some or all of it would be returned via corporate and personal tax cuts.

The Liberals are presenting themselves as green and see the issue as a weakness of the Conservatives, but the government counters that greenhouse gas emissions soared under Liberal rule and dismiss the carbon tax plan.

"Stephane Dion has made tens of billions of dollars of non-budgeted spending promises. He's now trying to trick Canadians into paying a permanent new tax he once opposed to raise colossal sums of revenue," Conservative legislator Jason Kenney said in statement accompanying the ad campaign.

Some of the commercial are being broadcast on radio but some audio-visual adverts -- featuring a spot of black grease that talks -- are also being aired at gas station pumps.

"Instead of taking this seriously, what do the Conservatives offer? A cartoon, a talking grease spot," Dion said in Parliament on Monday.

"When are the Conservatives going to stop insulting Canadians and offer a real plan to tackle climate change instead of cartoons and a campaign of lies?"

The Liberals have said the price of gasoline would not rise since it already has a federal excise tax of 10 Canadian cents a liter (37 U.S. cents per U.S. gallon).

However, fuel oil, natural gas and some electricity would also be taxed, and the tax on diesel, used by transport trucks, would probably have to be nearly tripled to match the tax on the carbon content of gasoline.

Liberal enthusiasts for the idea think if the corresponding income tax cuts are highlighted, the carbon tax plan can be framed as something that will help encourage productivity while curbing the output of emissions blamed for climate change.

It does have some Liberals worried about campaigning on a new tax, however, and neither the Conservatives nor the other two opposition parties have backed the concept.

Young Conservatives in bright yellow shirts emblazoned with the website for the ads, www.willyoubetricked.ca, were passing out brochures in central Ottawa on Monday.

The Conservatives, elected in January 2006, hold only a minority of seats in the House of Commons and need the support of at least one opposition party to stay in power.

They have a slim polling lead over the Liberals and have a huge edge in fund-raising. This has made the Liberals hesitant so far to topple the government and given the Conservatives the wherewithal to launch periodic ad campaigns.

($1=$1.02 Canadian)

Additional reporting by David Ljunggren; editing by Rob Wilson

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