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Premiers not being truthful about carbon tax, Trudeau says while sparks fly in Ottawa

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Prime Minister Justin Trudeau says Conservative premiers across the country are "not telling the truth" when it comes to the carbon tax.

Doubling down on a letter penned the day prior, the prime minister accused his pollution-pricing opponents of "misleading Canadians," for not acknowledging the much-maligned April 1 price increase coincides with an increase to the quarterly federal rebate households receive.

"For ideological reasons, or reasons of pure partisanship, conservative politicians across this country are not telling the truth to Canadians. And that's why I called them out," Trudeau said during a press conference Wednesday in Vancouver.

He accused Conservative Leader Pierre Poilievre, and Canadian premiers opposed to the marquee Liberal policy, of trying to take money out of people's pockets, in direct contrast to their argument that the carbon tax is driving up costs across sectors.

Tensions have been high on Parliament Hill amid escalating Conservative-led opposition to the carbon tax, ahead of the incoming hike that will see the $65-per-tonne carbon price increase to $80 per tonne.

Trudeau's comments came hours after he joined the flurry of political leaders penning open letters about the carbon tax, and as fresh sparks were flying in Ottawa at a recalled House of Commons committee.

There, Liberal MPs were outraged over the Conservatives unilaterally inviting premiers opposed to the carbon tax to come testify.

Sparks fly over premiers testifying

Wednesday's hearing was sparked by the premiers of New Brunswick, Nova Scotia, Saskatchewan and Alberta publishing letters asking to appear urgently before the Liberal-led House Finance Committee to air their concerns about the looming hike.

With their request left unheeded — MPs are not sitting this week and most committees do not have meetings scheduled — Conservative MP and Government Operations and Estimates Committee chair Kelly McCauley decided to invite them instead.

But before the first premier on the docket — Saskatchewan's Scott Moe — could begin his testimony, numerous points of order were raised by Liberal MPs.

"You called the meeting unilaterally without instruction or consultation with the members of this committee… This is a political stunt and theatre, just part and parcel of where our Conservative colleagues are taking this, to get clips," Liberal MP Irek Kusmierczyk said.

Liberal MP Francis Drouin warned that setting this precedent would not be one Conservatives would be pleased with in the end, when Liberal committee chairs start calling witnesses at their sole discretion.

Defending the move as "fully within" his powers, McCauley made the case that because MPs were studying government spending plans, hearing what premiers had to say was relevant.

"There's lots of examples of other chairs doing such things. It is the privilege and obligation, I think, of the chair to call meetings," he said. "And I did so."

Not 'climate laggard': Moe, PBO testify

Twenty-five minutes into the hearing, Moe was given the floor.

"I do appreciate the very warm Canadian welcome," he said.

"I wore my red tie in the spirit of collaboration," Moe went on, launching into his arguments about why he thinks the federal price on pollution is making life more unaffordable and why he doesn't consider Saskatchewan a "climate laggard."

Facing questions from pro-carbon pricing Liberal, NDP and Bloc Quebecois MPs, the premier said while he believes in climate change and the need to reduce emissions, instead of forcing polluters to pay more, they should just emit less in order to displace higher-emitting competitors.

"That is how we build a strong Canadian economy. That is how we lower global emissions. And that's how we employ Canadians in your community, and in mine," Moe said.

Testifying after him, Canada's Parliamentary Budget Officer (PBO) faced a series of questions about his past and recent highly cited, but contradictorily interpreted, analysis of the economic impact of the carbon tax.

"You've been in the press almost as much as Miss Taylor Swift, I think, in recent days," Conservative MP Philip Lawrence said. Stating he was seeking clarity, he asked: "For the average family where the backstop applies, is there more money coming into Canadians' pockets, or leaving their pockets?"

"If one looks at the fiscal impact — that is the amount of the carbon tax paid directly, indirectly and the GST that applies on these embedded or direct carbon taxes paid minus the carbon rebate — most families are better off," PBO Yves Giroux started.

However, he went on, once the economic impacts of the carbon tax on some sectors of the economy such as oil and gas and transportation are factored in, "we find that most Canadian families in provinces where the federal backstop regime is in place will see a small negative impact of the carbon tax."

Liberal MPs were quick to question why Giroux did not factor in the cost of climate change in his calculations, to which the PBO said it's outside of the scope of his mandate, suggesting MPs look to external think tanks for that type of cost-benefit analysis.

From there, the hearing devolved into protracted procedural fighting over holding a second hearing with additional witnesses on Thursday. On the docket for that meeting are New Brunswick Premier Blaine Higgs and Alberta Premier Danielle Smith. 

Trudeau to premiers: offer alternative

In Trudeau's late Tuesday letter responding to Canada's premiers, he implored them to come up with a better climate action plan.

In a two-page message posted on social media, Trudeau defended the carbon pricing and coinciding rebate program as intentionally designed to be revenue-neutral and beneficial to most Canadian households, while driving climate action. 

"Putting a price on pollution is the foundation of any serious plan to fight climate change. It is the most efficient way to reduce emissions across the economy," Trudeau wrote. "Carbon pricing alone will account for one-third of our emission reductions by 2030."

Noting that the federal plan is a backstop for provinces that failed to implement an adequate system of their own, Trudeau said the federal government remains open to pulling its plan out of the provinces where it is opposed, as soon as they propose "credible systems."

Currently the federal price is imposed in Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador.

In effect since 2019, the pollution pricing regime applies a levy on greenhouse gas emissions, making it more expensive to burn fossil fuels in an effort to encourage Canadians to change their habits.

The prime minister called it "demonstrably false" that the carbon tax is a significant driver of inflation, pointing back to a Bank of Canada calculation also cited by a series of economists in an open letter issued Tuesday seeking to counter the Conservative-led opposition arguments against the policy. 

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