(Bloomberg) -- A Canadian provincial court ruled in favor of Prime Minister Justin Trudeau’s carbon tax, in what is poised to be a lengthy legal fight.
In a 3-2 split decision Friday, the Court of Appeal for Saskatchewan ruled that the federal Greenhouse Gas Pollution Pricing Act “is not unconstitutional either in whole or in part.” A minority of the court disagreed.
The federal government imposed the tax this year on holdout provinces, including Saskatchewan, which had not introduced their own equivalent carbon plan. The system includes a levy on fuels, rebates to households and certain exemptions for trade-exposed major emitters.
Trudeau’s environment minister welcomed the ruling. “It confirms that putting a price on carbon pollution and returning the revenues to Canadians through the Climate Action Incentive rebate is not only constitutional, it is an effective and essential part of any serious response to the global challenge of climate change,” Catherine McKenna said in a statement.
The incumbent Liberals head into an election this fall. Trudeau’s chief rival, Conservative Leader Andrew Scheer, is pledging to scrap the federal carbon tax but hasn’t yet released his own climate plan.
Other provinces, including oil-rich Alberta, are challenging the tax and the legal fight could makes its way to the Supreme Court of Canada.