IMF Pegs Canada's Fossil Fuel Subsidies at $34 Billion


tay
#1
In such giveaways we're a world leader, a fact rarely noted when federal budgets are debated.






While Canada slashes budgets for research, education and public broadcasting (external - login to view), there is one part of our economy that enjoys remarkable support from the Canadian taxpayer: the energy sector.


These figures are found in the appendix of a major report (external - login to view) released last year estimating global energy subsidies at almost $2 trillion. The report estimated that eliminating the subsidies would reduce global carbon emissions by 13 per cent. The stunning statistics specific to this country remain almost (external - login to view) completely unreported in Canadian media.


Contacted by The Tyee, researchers from the IMF helpfully provided a detailed breakdown of Canadian subsidies provided to petroleum, natural gas and coal consumption. The lion's share of the $34 billion are uncollected taxes on the externalized costs of burning transportation fuels like gasoline and diesel -- about $19.4 billion in 2011. These externalized costs include impacts like traffic accidents, carbon emissions, air pollution and road congestion.


The report also referenced figures sourced from the OECD showing an additional $840 million in producer support (external - login to view) to oil companies through a constellation of provincial and federal incentives to encourage fossil fuel extraction. This brought total petroleum subsidies in Canada in 2011 to $20.23 billion -- more than 20 times the annual budget (external - login to view) of Environment Canada.


In comparison to other countries, Canada provides more subsidies to petroleum as a proportion of government revenue than any developed nation on Earth besides the United States and Luxembourg.


What could Canada do with an extra $34 billion a year?


Both Vancouver and Toronto are struggling with how to fund long overdue upgrades to public transportation. Subway construction comes in at about $250 million per kilometre, meaning we could build about 140 kilometres of badly-needed urban subway lines every year. Light rail transport (LRT) is about one-quarter of the cost of subways, meaning for the same money we could build about 560 kilometres of at-grade transit infrastructure.


The proposed Vancouver subway line (external - login to view) to the University of British Columbia could be built using less than two months of the subsidies provided every day to the energy sector. Forty kilometres of rapid transit in Surrey could be had for about the same amount.

What about green energy infrastructure? Adding solar and wind capacity provides (external - login to view) some of the best job-generation per dollar of any option available -- more than seven times the employment from an equivalent investment in oil and gas extraction. Extrapolating the findings from a 2012 report (external - login to view) on green jobs, $34 billion could create 500,000 person years of employment and install more than 150,000 megawatts of clean generating capacity. Canada currently ranks (external - login to view) 12th in the G20 on green energy investment and has been steadily falling behind our competitors.

Canada's infrastructure deficit of crumbling roads and outdated water and sewage treatment is pegged (external - login to view) at $171 billion. This backlog could be wiped out in five years with the revenue we are subsidizing to the energy sector.


Of course, not all things of value can be measured by bricks and mortar. Thirty-four billion dollars each year could provide $10-a-day childcare for 5.5 million children ages 0 to 5. Canada's child care costs are currently the highest (external - login to view) in the OECD.




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The Tyee – IMF Pegs Canada's Fossil Fuel Subsidies at $34 Billion (external - login to view)
 
captain morgan
Bloc Québécois
+1
#2
Excellent, but it's still not enough... Once we get rid of the CBC, we can apply that extra $1 billion to more subsidies to oil companies.

My vote is that we give the Sr Execs in the companies big, cash bonuses (non taxable).
 
mentalfloss
#3
This will lead to petros denial about the definition of a subsidy.
 
captain morgan
Bloc Québécois
+1
#4
This has already been explained. The usual suspects have either no clue, or are so wound up in feeling left-out that the only response is to keep pretending.

I say, we have some fun with it
 
petros
+1
#5
Quote:

Contacted by The Tyee, researchers from the IMF helpfully provided a detailed breakdown of Canadian subsidies provided to petroleum, natural gas and coal consumption. The lion's share of the $34 billion are uncollected taxes on the externalized costs of burning transportation fuels like gasoline and diesel -- about $19.4 billion in 2011. These externalized costs include impacts like traffic accidents, carbon emissions, air pollution and road congestion

More tax credits. Anyone with a business gets the FTC and some of us don't pay road taxes on fuel.

Still not subsidies.
 
captain morgan
Bloc Québécois
+1
#6
What do you expect Petros, 'The Tyee' contacted the IMF on this ever so carefully researched report.
 
petros
#7
Quote: Originally Posted by captain morganView Post

What do you expect Petros, 'The Tyee' contacted the IMF on this ever so carefully researched report.

The IMF doesn't know the difference either or the Tyee is full of sh-t. Which is it?
 
captain morgan
Bloc Québécois
+1
#8
Both I guess... Apparently, the IMF doesn't have the ambition to look into the situation themselves or they don't understand basic accounting.

I'm guessing that the next logical step for the IMF is to propose a tax on Canada in order to study this most perplexing situation
 
petros
+2
#9  Top Rated Post
I guess some get the child tax credit as cash and think it's free money and that is what business gets, free money like having a child.
 
taxslave
No Party Affiliation
+2
#10
The Tyee is not what one would call an objective source of information. Offencive perhaps.
When the price at the pump is more tax than fuel it is difficult to see a subsidy.
 
captain morgan
Bloc Québécois
+1
#11
Quote: Originally Posted by taxslaveView Post

When the price at the pump is more tax than fuel it is difficult to see a subsidy.


The underlying question is: Exactly who is being subsidized?
 
taxslave
No Party Affiliation
+1
#12
Quote: Originally Posted by captain morganView Post

The underlying question is: Exactly who is being subsidized?

The political class and all the hangers on that spend their days inventing rules so they can justify their jobs enforcing them.

And city people that don't drive.
 
Walter
#13
IMF is just another redistribute organization. Left is left.
 
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