Strategy

The CEO Poll: Gas fumes

Canadian business leaders decry Liberal carbon tax.

Business leaders give the federal mini-budget high marks.

Nothing gets people’s blood boiling like a new tax. Liberal leader Stéphane Dion has proposed a carbon tax (the details are expected to be released this week) and the 115 Canadian business leaders surveyed by COMPAS Inc. are overwhelmingly opposed to the idea.

More than half of the respondents disagreed with the concept of a carbon tax, despite a COMPAS poll from September in which the panel said “Canada’s priority must be to pay the necessary costs for cutting the use of fossil fuels.” Only 23 CEOs, or 20%, were in favour of a carbon tax in the current poll.

There were many reasons for the opposition. More than three-quarters of the respondents felt a tax wasn’t necessary given the dramatic surge in the price of oil, and that imposing further costs on oil and gas consumption would be foolish without having a clear strategy to replace fossil fuels. “Market forces [fuel costs] are already beginning to curb use,” wrote one CEO. “The focus needs to be on alternatives like nuclear and other non-traditional energy sources.”

Others felt a carbon tax would simply be an added burden on Canada’s already struggling manufacturing sector, and that any new tax would be irresponsible at a time when the economy may be headed for a recession.

Many of the CEOs’ comments were focused on denouncing the Liberals and carbon taxes. “How can the Liberals call this leadership when they were in power for many years and did nothing?” asked one respondent. “Mr. Dion’s proposal is a weak and transparent attempt to capitalize on prevailing green sentiments. It would further diminish the already fragile discretionary spending by consumers,” wrote another.

Yet some members of the panel were more sensitive to the issue of CO2 abatement, and offered other ideas. “Mandating tough fuel economy standards on auto manufacturers will do far more to reduce greenhouse emissions than a tax,” wrote one CEO.

Most members of the panel felt that a carbon tax didn’t make sense since Canada is a relatively small emitter compared to the United States and China, but others believed that was no reason not to set an example. “In spite of Canada’s ‘small footprint,’ we should take a leadership role. This tax is based on consumption — use less, pay less,” wrote one CEO. “Provide tax relief that encourages the use of alternative energy sources.”