Committee Cannot Endorse GNWT Approach At This Time

Overall, committee does not see a benefit to passing Bill 60, compared with the alternative of the federal backstop.

The government has not provided committee or the public with enough information to show that its approach is better. While the government can't control whether or how the tax is imposed, it does control how to use those revenues. In this area, the government's proposal to address cost-of-living impacts of the tax are not enough. The government's budget holds on to 25 percent of the carbon tax revenues - equal to $16 million - in general revenues rather than providing direct rebates to businesses, community governments, Indigenous governments, and NGOs.

In recent weeks, the government has taken a couple steps that respond to committee's
concerns to address the cost impacts of the tax. The department has proposed a regional COLO to heating offsets, allowing residents in the five communities with the highest fuel use to receive higher rebates. And at the clause-by-clause review, the Minister said she was thinking about a $1 million fund for community governments to offset increased costs. While these proposals are welcome, they still do not go far enough. The $1 million amount, spread across 33 communities, is unlikely to fully compensate increased costs.

Committee is mindful that there is little time left for the GNWT to meet Canada's April
1st, 2023 deadline to update our carbon tax law. Some Members disagree with the carbon tax in principle and prefer allowing the federal government to impose its own tax. Other Members believe there is still a narrow opportunity to improve the government's made-in-the-NWT approach. For now, committee decided to report Bill 60 as not ready
for consideration in Committee of the Whole, and that Bill 60 should not proceed at this
time.

Conclusion

On February 14th, 2023, committee held a clause-by-clause review. Committee passed a motion to report Bill 60 to the Legislative Assembly as not ready for consideration in Committee of the Whole.

This concludes the Standing Committee on Government Operations' review of Bill 60.

Recommendation 5

That the Standing Committee on Government Operations recommends that the Government of the Northwest Territories provide a response to this report within 120 days.

Thank you, Mr. Speaker.