Carbon Price Increase to $80 per Tonne Spurs Surge in Rebates
Today marks a rise in the federal carbon tax and accompanying rebates, as the national price on carbon emissions escalates from $65 to $80 per tonne.
Although the national carbon price applies universally, not all individuals are subject to the federal carbon tax and subsequent rebate scheme.
Distinct from the rest of the nation, Quebec, the three territories, and British Columbia operate under differing carbon pricing frameworks, where residents do not receive federal rebates. Conversely, residents in the remaining provinces fall under the federal government’s carbon tax or fuel levy, entitling families and individuals to rebates from Ottawa.
Canada’s approach to carbon pricing for industrial emitters encompasses a blend of federal, provincial, and territorial systems.
With the implementation of the new carbon pricing, motorists can expect an additional cost of 3.3 cents per litre of gasoline, effective immediately.
Higher Costs
Commencing today, the hike in the federal carbon tax will translate to an additional expenditure of 3.3 cents per litre for drivers refueling at the pump. Since the introduction of Ottawa’s fuel levy in 2019, the carbon tax has cumulatively augmented the price of a litre of gasoline by 17.6 cents. Information on levies for other fuels is accessible online.
According to Finance Canada, the rebates, now rebranded as the Canadian Carbon Rebate, have also seen an uptick in alignment with the carbon price surge. To qualify for the rebate, individuals must submit an income tax return. The rebate is then disbursed via direct deposit into their bank account or by mail through a cheque.
Rebates are distributed on a quarterly basis, with the subsequent payment slated to arrive as early as April 15.
Outlined below are the quarterly rebate amounts for single adults:
- $225 in Alberta.
- $150 in Manitoba.
- $140 in Ontario.
- $188 in Saskatchewan.
- $95 in New Brunswick.
- $103 in Nova Scotia.
- $110 in Prince Edward Island.
- $149 in Newfoundland and Labrador.
Additionally, here are the quarterly rebate amounts for families of four:
- $450 in Alberta.
- $300 in Manitoba.
- $280 in Ontario.
- $376 in Saskatchewan.
- $190 in New Brunswick.
- $206 in Nova Scotia.
- $220 in Prince Edward Island.
- $298 in Newfoundland and Labrador.
Residents in rural areas receive a 10 percent increase in their rebates due to their typically higher rates of driving and fuel consumption. This rural top-up is set to double once a bill currently under consideration in Parliament is passed into law.
According to the federal government, all funds collected directly through the federal carbon pricing system are redistributed to the respective province or territory where they were collected. Approximately 90 percent of the revenue generated from the federal carbon tax is allocated towards rebates, while the remaining portion is allocated to Indigenous communities, farmers, and businesses.
Despite being a cornerstone of federal Liberal climate policy, national carbon pricing is encountering increasing opposition. Prior to the recent increase, the opposition Conservatives, along with at least seven premiers, urged the government to cease the rise. Conservative Leader Pierre Poilievre has pledged to eliminate the tax if his party forms the government, citing the financial strain the escalating carbon price imposes on families and businesses.
The future stance of a potential federal Conservative government regarding carbon pricing for industrial emitters remains uncertain. Poilievre has not provided specifics on how his proposed approach of “technology not taxes” would ensure Canada meets its emissions reduction targets.
