Statistics Canada says removing carbon tax helped drop Sask. inflation rate

Statistics Canada says the decision by the Saskatchewan government to remove the carbon tax from home heating helped reduce the province’s inflation rate in January.

According to the Consumer Price Index report released Tuesday by the federal agency, Saskatchewan’s inflation rate fell to 1.9 per cent last month from 2.7 per cent in December.

“In Saskatchewan, the collection of the carbon levy ceased in January 2024, contributing to the province’s year-over-year price decline of natural gas (-26.6%),” the report said.

The inflation rate in Regina fell to 2.4 per cent from 3.1 per cent a month earlier, while the rate in Saskatoon dropped to 2.3 per cent in January from 3.2 per cent in December.

In a release from the provincial government, Crown Investments Minister Dustin Duncan said the data showed what the federal Liberals need to do to reduce the cost of living for families.

“If they are actually serious about fighting inflation, the federal government needs to remove the carbon tax on everyone and everything,” Duncan said.

“This shows how much impact it has, just removing it on home heating in one province. Imagine the significant impact it would have on gas prices, grocery prices and everything else we produce and transport in Canada if the federal government scrapped the carbon tax.

“Instead, they are fully committed to another carbon tax increase on April 1. It shows they really don’t care about the impact is it having on Canadian families struggling with the cost of living.”

The Saskatchewan government has opposed the federal carbon tax from the beginning, even launching an appeal of its constitutionality. The province ultimately lost that battle in the Supreme Court of Canada.

In October, Prime Minister Justin Trudeau announced a pause on carbon pricing for heating oil in Atlantic Canada. That doesn’t affect Saskatchewan much, as most residents in the province use natural gas to heat their homes.

In a video posted to social media a week later, Premier Scott Moe said he wanted the federal government to extend that pause to all sources of home heating across the country. He then vowed that the province would stop collecting the carbon tax on home heating if the feds didn’t offer Saskatchewan residents a similar break to that enjoyed by Atlantic Canadians.

The provincial exemption was applied not only to natural gas through SaskEnergy, but electric heat through SaskPower as well.

However, the decision not to collect the carbon tax in Saskatchewan also could reduce the amount paid out in carbon tax rebates in the province.

In Canada, the national inflation rate also fell month to month. The national rate was 2.9 per cent in January, down from 3.4 per cent in December.

The biggest part of that was lower gas prices. Grocery inflation also was moving at a slower speed, down to 3.4 per cent last month from 4.7 per cent in December.