Saskatchewan files for injunction for Canada Revenue Agency to collect carbon money

QUEEN — Saskatchewan will go to court to stop the Canada Revenue Agency from collecting millions of dollars in carbon tax money — but the federal government says it will stand firm because the law is the law.

Saskatchewan Justice Minister Bronwyn Eyre announced Thursday that the province has filed an injunction to stop the federal revenue service from the province’s bank account.

The application, filed in Federal Court in Vancouver, claims it is unconstitutional for the agency to take from the province’s consolidated revenue fund, Eyre told reporters.

She said Ottawa wants about $28 million.

“This is essentially an unfair targeting of Saskatchewan,” Eyre said.

“A group of Canadians got help and another province (is going to have) its bank account raided. Is that really where we want to be in this country?”

Earlier this year, Premier Scott Moe’s Saskatchewan Party government stopped paying the carbon tax on natural gas after Prime Minister Justin Trudeau exempted home heating oil users from paying.

Trudeau’s move was widely seen as helping those in Atlantic Canada, where home heating oil is commonly used and where polls suggest the federal Liberals need to shore up popular support.

By not paying the tax, Saskatchewan is in violation of federal emissions law. The province could face fines or the minister responsible for natural gas distribution could face jail time for not following the rule.

The federal government responded to the ban request later on Thursday, saying it had a firm legal basis to obtain the money.

“(The Canada Revenue Agency) is handling the case and has pursued collection as required by law,” National Revenue Minister Marie-Claude Bibeau said in a statement.

“We are firm in upholding the law.”

Bibeau said Saskatchewan has chosen not to listen, noting that the Supreme Court of Canada has ruled that the carbon tax is constitutional.

“Our commitment to fairness and equality for all Canadians is unwavering as we strive to level the playing field and promote environmental responsibility at the national level,” she said.

Eyre said the province has a strong case to make, arguing the tax is no longer applied equally across Canada.

“The premise of the carbon tax was minimum national standards (and) fair enforcement across the country,” she said.

“The (Supreme Court) decision predated any of these exclusions and exceptions.”

Trudeau said Saskatchewan residents will continue to receive carbon rebates, arguing that most Canadians receive more rebates than what they pay in taxes.

Some prime ministers and the leader of the federal conservative opposition, Pierre Poilievre, argue that the tax makes life more unaffordable.

This report by The Canadian Press was first published on July 4, 2024.

Jeremy Simes, Canadian Press