New Brunswick cancels legal action against Canadian federal carbon tax

The Canadian province of New Brunswick has decided to abandon plans to launch its own legal challenge against the Canadian federal carbon tax, considering that this procedure was redundant with the ones launched by the Ontario and Saskatchewan provinces and would be too expensive for tax payers. New Brunswick will remain an intervener in the legal challenge opened by Saskatchewan and brought to the Supreme Court of Canada. In addition, the Quebec government, which has its own carbon pricing policy (carbon exchange with California in the United States), has decided to intervene before the Supreme Court in the Saskatchewan challenge, considering that carbon pricing should be a provincial responsibility.

Canada's nationwide climate-change strategy includes a carbon tax, which has to be either adopted by the provinces or imposed by the federal government. The tax will rise by CAD10/tCO₂eq (around US$7.6/tCO₂eq) each year from CAD20/tCO₂eq (around US$15.3/tCO₂eq) in 2019 to CAD50/tCO₂eq (around US$38/tCO₂eq) by 2022. Quebec, British Columbia, Nova Scotia, Prince Edward Island and Newfoundland and Labrador will comply with the federal benchmark, whereas Alberta repealed the carbon tax it had implemented in May 2019. Other provinces, namely Manitoba, Ontario, New Brunswick and Saskatchewan, refuse to implement adequate carbon emission pricing plans and to adopt the country-wide CO₂ pricing system. Consequently, the federal "backstop" mechanism applies in Manitoba, Ontario, New Brunswick and Saskatchewan since April 2019, which have decided to challenge the tax in court, and was extended in Nunavut and Yukon on 1 July 2019: in these provinces, proceeds from the new tax will go directly back to taxpayers (direct rebates named "Climate Action Incentive payments"). The backstop tax will be applied to Alberta as of 1 January 2020.