Freeland to scrap consumer carbon tax if she becomes Liberal leader, to officially launch bid Sunday: source

Chrystia Freeland is set to officially announce her Liberal leadership bid on Sunday, a source close to her tells CTV News, and the former finance minister will make scrapping the controversial consumer carbon tax one of her campaign policy planks.

“She is ready to make difficult decisions to meet our emissions targets and make sure big polluters pay for their outsized emissions. But she will not fight Canadians on a policy, they have been clear, they do not support,” the source told CTV News.

“That’s why Chrystia Freeland will replace the consumer carbon price with a system that will work within our federation and will be developed collaboratively with provinces and territories.”

Freeland had previously defended the carbon tax during her time in Prime Minister Justin Trudeau’s cabinet.

Freeland also intends to announce dollar-for-dollar retaliatory tariffs to counter U.S. president-elect Donald Trump’s threat of 25 per cent tariffs on all Canadian goods, in making her campaign launch ahead of Trump’s inauguration on Monday.

In a post shared on X on Wednesday, Freeland addressed registered Liberals, saying she is “grateful for the chance to hear from you and listen to your ideas” and that she will “have much more to say very soon!”

A number of Liberal MPs have publicly endorsed Freeland as a candidate for the Liberal leadership. Health Minister Mark Holland, Winnipeg MP Ben Carr and former cabinet colleague Randy Boissonnault added their names to the growing list of Liberals throwing their support behind her.

Freeland left cabinet on Dec. 16 in a stinging resignation letter, saying she was at odds with Trudeau over a number of policies, including the GST tax holiday break and $250 cheques the government had planned to hand out to working Canadians.

Freeland called them “costly political gimmicks,” which she didn’t think Canadians can afford with the economic threat of tariffs looming.

Her resignation, coupled with growing calls for a change in leadership, pushed the prime minister to announce his resignation as Liberal leader effective March 9.

Trudeau, Poilievre respond

Responding to the major policy pivot from his former right-hand, Trudeau said that those running to replace him “obviously” can “put forward their own ideas about how to fight climate change.”

“But I am very, very proud of our record of standing up and fighting climate change and making life more affordable for Canadians.”

Also weighing in, Conservative Leader Pierre Poilievre – who has said he thinks the next election will be about the carbon tax – pointed to Freeland helping pass into law Trudeau’s plan to increase the carbon price to 61 cents a litre over the next five years.

“These lying Liberals will deny that, right before the election, to try and trick Canadians into letting them back in to raise taxes all over again,” Poilievre said.

The consumer carbon tax came into effect in 2019 under the Trudeau government and has grown to be unpopular among Canadians.

The Conservatives have used the policy to attack Liberals for years. The tax has also received significant pushback from most premiers, including Liberal Newfoundland and Labrador Premier Andrew Furey, and some Liberal MPs have even expressed a desire to scrap it.

This April, the price on carbon is set to increase to $95 a tonne from $80 a tonne in provinces where the federal backstop applies, costing drivers an extra 3.3 cents per litre at the pump.

The tax is scheduled to increase another $15 each year until it reaches $170 a tonne in 2030. To offset the cost, Canadians who live in regions where the backstop applies will receive a quarterly payment known as the “Canada Carbon Rebate.”

Mark Carney won’t confirm carbon plans

In launching his own Liberal leadership bid in Edmonton on Thursday, former governor of the Bank of Canada and Bank of England Mark Carney stopped short of confirming reporting that he too will scrap the tax.

While Carney hinted in an interview Monday on “The Daily Show” that he may also make changes to Canada’s carbon pricing, on Thursday he wouldn’t go into detail about his intentions, beyond saying his plan would be “comprehensive” and not a “sound bite.”

“I’ve said for a long time that if you are going to take out the carbon tax, you should replace it with something that is at least, if not more effective,” Carney said.

“And by effective, it’s not just having the same impact in reducing greenhouse gas emissions, but it’s making our companies more competitive, it’s creating jobs, it’s ensuring that Canadian households are made whole in terms of their finances. Because perception may be that it takes out more than the rebate provides, but reality is different, and Canadians will miss that money.”

With files from CTV News' Brennan MacDonald and Rachel Aiello