Federal carbon tax exemption on home heating oil won't apply to N.W.T.

If the N.W.T. wants a carbon tax exemption for home heating oil, it'll have to pass its own law for that, says the territory's Liberal MP.

New federal rules that exempt some provinces and territories from paying carbon tax on home heating oil won't apply to the N.W.T. because the territory has its own carbon tax legislation. That legislation would have to be amended by the next Legislative Assembly, said MP Michael McLeod.

The N.W.T. is in the midst of a territorial election and the assembly is currently dissolved.

"That discussion has got to be something that the new Legislative Assembly members will have as soon as they're duly elected," McLeod said.

But McLeod told CBC Trailbreaker host Hilary Bird Tuesday morning the exemption shouldn't matter anyway, because the carbon tax already comes with a rebate.

"In the Northwest Territories, we all get the carbon pricing rebate, whether we heat our homes with wood, propane or fuel. So it really doesn't make a difference," he said.

I think most people can plan and budget accordingly.- N.W.T. Liberal MP Michael McLeod

Last March, the N.W.T. Legislative Assembly voted by a slim margin to replace the direct rebate system with an increase to the territory's cost of living offset, which is a flat tax-free benefit for residents.

At the time, MLAs split over the impact it would have on heating costs in small, remote communities.

When asked what he would say to people who can't afford to pay higher heating bills and then wait months to get reimbursed, McLeod said some households are getting "significant amounts" through the offset and most can "really plan and decide how they want to invest their money."

"Not everybody can't manage their finances, as you're suggesting," he told Bird.

"I think most people can plan and budget accordingly."

Territory 'examining options'

In an email, N.W.T. Department of Finance spokesperson Todd Sasaki wrote that the N.W.T. government is "examining options to provide a similar exemption for N.W.T. residents that does not create inequitable treatment to those using propane and natural gas."

CBC requested interviews with Premier Caroline Cochrane and Finance Minister Caroline Wawzonek, but officials said election rules prohibit them from speaking about the issue.

Cochrane is not running for re-election. Wawzonek has been acclaimed in her riding.

The territory's current carbon tax legislation, championed by Wawzonek as the best alternative to a federal system, barely passed in March after months of heated debate.

The change was forced by federal rules that prohibit certain carbon tax rebates.

It drew ire from many MLAs, including Nunakput MLA Jackie Jacobson and Monfwi MLA Jane Weyallon Armstrong, with Jacobson arguing people in his riding already find it hard to make ends meet.

Jacobson is not running for re-election. Weyallon Armstrong has been acclaimed for another term.

McLeod said the federal Liberals haven't been in touch with the territorial government about the issue because of the election currently underway. When the new Legislative Assembly starts sitting, MLAs can decide for themselves what to do, he said.

"They may want to keep the current system that's in place. It seems to be working pretty good," he said. "Or they may want to do a complete change. But that's their call."