New Brunswick's new carbon tax will cost drivers 2 cents a litre, Higgs says

Premier Blaine Higgs says his new provincial carbon tax will cost New Brunswickers about two cents a litre at gas pumps starting April 1.

That will be a reduction from the federal carbon tax, which is scheduledto rise to 6.6 cents a litre from the current 4.4 cents on that date but instead will stop being applied in the province.

The premier said there are still details to work out, and "we haven't quite figured out how that's going to work yet," but two cents is the approximate amount.

Higgs said the money raised from the provincial carbon tax will go toward green energy and climate initiatives.

The premier campaigned last year on a promise that any money the province collected, if it were forced to put a tax on carbon, would be rebated to consumers.

But he said using the money on green initiatives was a requirement of the deal with Ottawa that he announced Wednesday.

New Brunswickers have been paying the 4.4-cents-a-litre federal backstop since April, when the Trudeau government imposed it on four provinces that refused to put a price on carbon.

After the Trudeau Liberals won October's election, Higgs said he would reluctantly comply with the federal requirement.

His proposal was similar to the system already in place in Prince Edward Island.

The P.E.I. government set up its own 4.4-cent-a-litre tax but lowered the existing provincial gas tax by almost the same amount, for a net increase to consumers of one cent.

The Higgs government has also proposed its own carbon price for large industrial emitters as an alternative to the federal backstop for industry that is already in place in the province.

That hasn't been approved yet by Ottawa. Higgs said he hopes to discuss that with Prime Minister Justin Trudeau when they meet next Monday.