Ontario’s Green Energy “Fee”: The Trouble with Taxation through Regulation
AbstractCanadian provincial governments have broad authority to impose direct taxes by passing enabling legislation in their respective legislatures. Governments may also use regulation to set fees, for example, to recover the cost of services they provide, but cannot use regulation to impose taxes that raise general revenue. Doing so would be unconstitutional. Governments nonetheless sometimes attempt to raise revenue by imposing levies that are deliberately mislabelled as “fees” – past efforts to do so have exposed provincial governments to successful constitutional challenges. This e-brief examines problematic example: the Ontario government recently ordered the Ontario Energy Board to impose a “fee” to be used to fund activities of the Ministry of Energy and Infrastructure; this fee is quite likely an unconstitutional tax.
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Bibliographic InfoPaper provided by C.D. Howe Institute in its series e-briefs with number 98.
Length: 5 pages
Date of creation: Apr 2010
Date of revision:
Publication status: Published on the C.D. Howe Institute website, April 2010
Governance and Public Institutions; Ontario Energy Board; Independent Electricity System Operator (IESO); taxation; regulation; unconstitutional tax;
Find related papers by JEL classification:
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- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
- L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-05-15 (All new papers)
- NEP-ENE-2010-05-15 (Energy Economics)
- NEP-ENV-2010-05-15 (Environmental Economics)
- NEP-PBE-2010-05-15 (Public Economics)
- NEP-REG-2010-05-15 (Regulation)
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