In lieu of our blog this week, an examination by Resource Works of Canada’s carbon tax and its impact on the economy, and on the oil and gas sector.
Among the findings (that need attention from the next federal government):
- Companies have shifted from capital expenditures to record dividend payouts, signalling a lack of confidence in reinvesting in Canada.
- The disproportionate burden placed on Canada’s energy sector has driven reduced capital expenditures, weakened trade performance, and ultimately contributed to the depreciation of the Canadian dollar.
- Capital investment in the sector declined from $80 billion in 2014 to $24 billion by 2020, a level not seen since 2002.
- And other nations are not implementing carbon pricing at Canada’s scale, meaning the economic burden is assumed unilaterally without global reciprocity. This has created a competitive disadvantage by accelerating capital flight and reinforcing economic headwinds.
The conclusion: “A reassessment of Canada’s carbon pricing structure is necessary to prevent further deterioration in investment levels and to restore confidence in domestic capital allocation.
“Without reform, the Canadian economy will continue to experience weakened trade performance, currency depreciation, and broader inflationary pressures driven by declining investment and rising costs of living.”
- Read the full analysis here: https://ow.ly/VPjS50Vtuim
Posted here 02 April 2025
