Oil and gas lobbyists got to work in the run-up to Tuesday’s budget, the federal lobbyist registry shows.
The Canadian Association of Petroleum Producers (CAPP) met with department officials and parliamentarians at least 30 times since January. Similarly, the Pathways Alliance, which represents the six largest oil sands companies (Suncor, Cenovus, ConocoPhillips, Canadian Natural Resources, MEG Energy and Imperial Oil), met with government officials. at least 23 times this year. Only meetings initiated by lobbyists are reflected in the registry.
And while it’s not known exactly what was discussed, it’s notable that Tuesday’s budget did not include any windfall tax on oil and gas companies.
This disappointed climate advocates, who had pushed hard for the windfall tax. By not imposing a windfall tax on oil and gas companies that have posted record profits since Russia’s invasion of Ukraine disrupted energy markets, a huge opportunity was missed to address affordability and the climate crisis, they say.
“Over and over again we see [the fossil fuel] “The industry and its associated lobbyists deploy enormous amounts of resources to delay and distract from climate action that is in the best interests of people in Canada,” said Climate Action Network Canada executive director Caroline Brouillette. Canadian National Observer. “So, when those interests are heard more than a large group of organizations “Representing citizens and the public interest, I question the impact this has on our democracy.”
Despite the record profits, some in the oil and gas industry, such as Cenovus CEO Alex Pourbaix, have argued that the industry should not be forced to pay more taxes through a windfall profits tax. , as countries such as the United Kingdom, Germany, the Netherlands, Italy and others have implemented it.
The lobbyist registry shows that Pathways Alliance president Kendall Dilling met with Finance Minister Chrystia Freeland on March 15. The lobbyist registry notes that Pathways Alliance wanted to speak with government officials about the 2024-25 budget.
Freeland’s office did not respond to a request for comment by deadline.
After being beaten day after day by Conservative Party of Canada leader Pierre Poilievre on affordability issues, it’s no secret that the ruling Liberals want to be seen fighting for Canadians against the high cost of living.
“Over and over again we see [the fossil fuel] “The industry and its associated lobbyists deploy enormous amounts of resources to delay and distract climate action… I question the impact this has on our democracy.” #cdnpoli
According to the Parliamentary Budget Officer (PBO), a 15 per cent flat tax on oil and gas companies earning more than $1 billion in taxable income would raise $4.2 billion for the public purse over the next five years, that could be used to fund climate action and address affordability issues. And the policy would also be popular, as polling firm Leger found that a majority of Canadians support a windfall tax on fossil fuel companies, with support especially strong in seat-rich Quebec and Ontario.
For climate advocates across the country, the introduction of a windfall tax was one of the litmus tests for this year’s budget. Instead of a specific tax targeting oil and gas companies, the federal government opted to modify the capital gains tax. Capital gains refer to profits made from the sale of things like stocks or real estate and represent one of the main ways the wealthiest Canadians make money. Finance Canada estimates that the changes will not raise taxes for 99.87 per cent of Canadians, illustrating that the adjustment is aimed at the ultra-wealthy.
Currently, capital gains are taxed at 50 per cent, meaning the wealthiest Canadians pay no taxes on half of their income. The 2024 budget proposes applying the tax to 66 percent of your income, a step that advocates say is in the right direction, but not enough.
Speaking to the Liberal caucus on Wednesday, Prime Minister Justin Trudeau hailed his government’s new budget as a plan that builds a fair economy for all, while noting that the government is asking those who have benefited most from the economy to Canada to pay more.
“We don’t think it’s fair for a teacher or an electrician to pay taxes on 100 percent of their income, while a billionaire pays taxes on only 50 percent of the passive income they make from their capital gains,” he said. “Let’s make them pay a little more.”
For Brouillette, a little more is not enough.
“The reason we need an extraordinary tax on oil and gas profits is because this is the industry that has been preventing us from… achieving our climate goals,” he said. “Taxing oil and gas windfalls is therefore not just about raising revenue for the public purse, but also about holding that industry accountable and protecting our democracy from its harmful influence on policymaking.”
Brouillette said there is also a “vicious cycle” at play, in which record oil and gas profits are reinvested in lobbying and advertising campaigns that misinform Canadians. The Canadian Competition Bureau is currently investigating Pathways Alliance following complaints that its “Let’s Set the Record Straight” marketing campaign is “false and misleading.”
University of Victoria associate professor James Rowe previously said Canadian National Observer that the Liberals are seeking to link their climate action to affordability concerns in a bid to combat Poilievre’s rise in the polls. Renaming the carbon price is part of that effort, but beyond the changes, Rowe said the Liberals must genuinely respond to everyday concerns.
“I think they’re worried about being labeled as liberals who tax and spend in an inflationary environment, but I think part of that is rooted in a misdiagnosis around the problem of inflation,” he said. “There are very good investigation demonstrate that corporate price gouging is playing a really important role.”