A new tax regime proposed by the Liberal government of Premier Shawn Graham in its June “Tax Green Paper” has most of the New Brunswick population seeing red. That’s due to a 2% increase in the provincial portion of the harmonized sales tax, and a new carbon tax on fuel, heating oil and electricity.

The provincial government estimates that the HST hike will add about $250 million to the province’s treasury annually, with the carbon tax pulling in another $100 million. Those increases, designed to reduce the consumption of fossil fuels and modelled on British Columbia’s new carbon tax, will be offset by steep cuts in corporate and individual tax rates, the green paper says; those cuts will lower the government’s take from income taxes by about $500 million. That leaves an estimated revenue shortfall of about $150 million.

Tax Green Paper? What is that? Isn’t it usually called a white paper? It sounds as if the government is trying to brand its new regime with an appeal to people’s concerns about climate change and the environment. The federal Liberals are doing the same with their “Green Shift” plan.

Today’s gas prices are at the highest levels they’ve ever been, and they got there remarkably fast. When the price of a commodity goes up, especially substantially, demand usually drops off. But not with gas. Studies prove that, despite price hikes, demand for gas remains almost the same — a perfect storm for a government looking for a new tax opportunity. Everyone needs it; everyone wants it — now and in the future.

Then there’s Stephen Harper’s stern warning during his visit to Fredericton in August. Speaking to members of the Conservatives’ Atlantic caucus, amid swirling election rumours, Harper claimed that the Liberals’ proposed carbon tax will devastate the Atlantic-Canada economy.

But nowhere does Harper mention how, on a national level, almost half of that tax revenue will come from the U.S., as it continues to buy more and more of our electricity and fossil fuels.

It sounds like a way to pit Atlantic-Canadians against their Liberal governments more than anything else. You can’t tell me that Harper doesn’t “get it” when it comes to the opportunity to impose new taxes in the context of rising concerns about climate change and fuel consumption. But then, I suppose, he’d have to do something about the environment with the money.

In that vein, then, the big question is: what will the proceeds of a carbon tax do? Reduce our energy consumption? That’s highly unlikely. Accumulate a massive fund for a Manhattan Project-style race for a cheap, abundant and totally clean alternative? I doubt that, too. Because adding new sources of tax revenue and reducing others at the same time is obviously only enough to pay the bills that already exist under the status quo.

A 2% hike in the HST, plus a new carbon tax, is only going to make life more expensive in New Brunswick. Plus, no one really knows how the province plans to make up for the $150 million shortfall that it predicts will be created by reducing other taxes.

Perhaps it will be from taxes on the output of Irving Oil’s proposed second oil refinery. A large portion of that will be sold to the U.S. — which sounds good to me, but it’s not very green. IE