The International Monetary Fund (IMF) is estimating Canada’s fossil fuel subsidies at $46.4 billion per year, far more than the $5.2 billion in subsidies and public finance calculated by Oil Change International and the Overseas Development Institute in a report released ahead of the UN climate summit in Paris last fall. The IMF also shows the subsidies are rising.
The big gap reflects the IMF’s method of calculation that includes uncollected taxes and externalized costs, as well as direct support.
Globally, this figure balloons to US$5.3 trillion or 6.5 per cent of the world's GDP. To put that enormous sum in perspective, the global giveaway to the energy sector amounts to 40 times more money than is contributed in aid to the world's poorest people.
What could Canada do with another $46 billion each year? There are proposed light rail projects that could be built and only Canada would have $35 billion left to spend. Canada’s need to build and maintain affordable housing, is estimated to be a $3 billion annual cost. Canadian national pharmacare programs might cost an extra $1 billion each year . A guaranteed annual income for each Canadian is another example.
Even after those large national projects, billions and billions of annual public revenue could provide tax relief to those shifting away from fossil fuels as well as transition training and jobs for displaced workers in our beleaguered oil sector.
Using the fossil fuel subsidies revenue differently and collecting all the back taxes owed to the Canadian government by the fossil fuel industry would go a very long way to making the transition to clean and renewable energy a reality. It would also mean Canada would reach its emissions and climate change goals.
View February 8, 2016 Clean Technica article
View February 3, 2016 The Energy Mix article
View February 1, 2016 The Tyee article
View July 17, 2015 International Monetary Fund article