Canadian opposition plans sweeping carbon tax

Wed Jun 18, 2008 2:52pm EDT
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By Randall Palmer

OTTAWA (Reuters) - Canada's Liberal Party will unveil a long-awaited carbon tax plan on Thursday, detailing an idea the Conservative government has dismissed but one the Liberals hope will help them return to power.

The opposition party said on Wednesday it would unveil what it is calling a "green shift," avoiding the word "tax" on the advice of veteran Liberal Senator David Smith.

A Liberal source had previously said the idea was to apply C$15 billion ($14.7 billion) in taxes on fossil fuels and return the same amount via income tax cuts.

The Conservatives got out ahead of the announcement with an advertising campaign that said Liberal leader Stephane Dion planned a "tax on everything." The Liberals hope the income tax cuts will sweeten the carbon tax plan with the public.

"We've only seen half the story, the negative half. The Conservatives have talked about the carbon tax. We have yet to talk about all the benefits arising from this," Liberal Member of Parliament John McCallum told reporters on Tuesday.

Conservative Prime Minister Stephen Harper accused Dion of trying to break a promise made when he was running for the Liberal leadership in 2006.

"The leader of the opposition told his own party during the leadership race that he would never impose a carbon tax, that it was bad policy," Harper told Parliament.

"What we will not do, and what will clearly hurt Canadian families, is to go around imposing carbon taxes at this time on all kinds of fuels."   Continued...