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CASF NEWS
CARBON TAX DISADVANTAGE:
SURFACE FINISHING
INDUSTRY AT RISK
By Bob Smith
re you the owner of a surface finishing manufacturing tonne to $170 over the next decade will have a cumulative cost for
facility or establishment in Canada? Are you an employer or Canadian manufacturing ranging between $65 billion and $82
Aemployee in the surface finishing industry? Then you need billion based on current levels of output and emissions. As the chart
to be concerned and should pay attention to this column. Our indus- below shows, there is a direct link between technology investment
try is at risk and you can help. and profitability. This means that every dollar removed from the
The concern over climate change and rising carbon dioxide levels sector is a dollar that cannot be invested in technological change and
is real. Responsible companies and business owners across the emissions reductions. This is why CME has long advocated on behalf
country have been actively investing in green technologies for years of its members for full revenue recycling from carbon taxes back into
and the surface finishing industry is a leader in the adoption of these industry – not taking this money and putting it into general revenue
new technologies. or to other sectors of the economy, including individuals and house-
Demand for action by environmentalists and their effect on some holds. (See Chart Bottom of Page)
governments for climate action is intense. In Canada, in response to While there are support programs for Canada’s industrial sector,
public pressure, the federal “Carbon Tax” was introduced and we are there is significant concern that these measures will fall short and
now seeing the effects of it on trade exposed manufacturing sectors will not leave Canadian manufacturing stronger, more resilient, or
such as ours – the surface finishing industry – and it’s not good news. globally competitive and some sectors, including ours, have been left
According to Alex Greco, Director-Manufacturing Policy, out of this program.
Canadian Manufacturers and Exporters (CME), the federal govern- From a recent report from the Fraser Institute: “…many manufac-
ment has released its framework Net Zero strategy which provides a turing sectors, including basic chemical manufacturing, primary
range of actions to be taken, most notably highlighted by a $170 per metal manufacturing, cement and concrete product manufacturing,
tonne carbon tax by 2030 and a Clean Fuel Standard. miscellaneous chemical product manufacturing, and non-metallic
By CME’s estimates, the escalation of carbon taxes from $50 per mineral product manufacturing, will be negatively affected.
After–Tax Cash Flow Drives Business INVT
Canada (four-quarter moving average, year-over-year change)
Source: Canadian Manufacturers & Exporters (CME) and Statistics Canada
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