The buzz out of Ottawa this week relates to an announcement from Prime Minister Trudeau that the Liberal government will enforce a national carbon tax onto Canadian provinces and territories that do not implement a provincial carbon tax or a cap and trade system by 2018.

The carbon tax was announced by Prime Minister Trudeau at the same time provincial environment ministers were meeting to discuss the same topic. This resulted in Saskatchewan, Nova Scotia and Newfoundland storming out of the conference and with some engaging in a war of words with the Prime Minister. In particular Premier Brad Wall of Saskatchewan pointed out that during the 2015 federal election, Prime Minister Trudeau stated the federal government imposing a climate change plan on provinces would be ‘nonsensical’ and demanded that the Prime Minister keep his word.

While this back and forth continues it is also worth noting that British Columbia already has a carbon tax in place with rates set already well above the entry carbon tax rate proposed by Ottawa.

While the national carbon tax announcement captured most of the media attention, there was another policy change quietly made by the government that may well have far more troubling implications on middle class Canadians attempting to buy a home. The Liberal government intends to make changes with respect to mortgage qualifications that even the Department of Finance projects could lower home sales across Canada by close to 10 per cent in the first year.

The changes to mortgage qualifications from my perspective are concerning for a number of different reasons.  While there is little debate that housing prices in Toronto and Vancouver have reached concerning levels, recent policy changes enacted by the B.C. government appear to be already having an impact and the changes announced by the federal Liberal government will penalize middle class home buyers in all regions of Canada.

More troubling is rather than try to encourage housing supply through measures such as possibly increasing the threshold for the GST rebate on new home construction that would also help affordability and generate economic growth, these measures in effect make housing less affordable as fewer families will be able to qualify for a mortgage.

In defense of these policy changes the Liberal government argues they are concerned about rising Canadian debt levels. However as the Opposition would point out, adding billions of dollars of debt through increased federal deficit government spending as is currently the case creates the same problem only without generating any equity as can be created through home ownership.

In my view, allowing provinces to take action in specific hot spot regions, such as the British Columbia government has done recently, may be a more effective policy than a national change that will adversely impact many regions of Canada solely for the benefit of a few.