Harper Says Carbon Tax May Trigger Canadian Recession

Bloomberg.com: Canada

Sept. 11 (Bloomberg) -- Canadian Prime Minister Stephen Harper said a plan by Liberal Party Leader Stephane Dion to tax the use of carbon-based energy would trigger a recession and re-ignite the pro-sovereignty movement in Quebec.

``Such policies would cause a big recession in this country, a recession equivalent to the recession in the early 1980s,'' Harper told reporters in Montreal today on a campaign tour ahead of elections on Oct. 14. ``It would be economically a catastrophe.''

The comments marked the first time Harper, 49, used the term ``recession'' since the vote was called. The Bank of Canada says the economy will grow 1 percent this year, the slowest since 1992, and Harper is trying to underpin his campaign with the idea Dion's tax plan is too risky. He also needs to broaden his Conservative Party's support among nationalist voters in the French-speaking province of Quebec.

``The ultimate purpose of a carbon tax is to get more money and power into Ottawa,'' Harper said, adding later that such a move would exacerbate tensions among regions including Quebec. ``Sovereigntists will be rubbing their hands.''