The first payments of the federal government’s revamped carbon climate incentive, officially minted the Canada Carbon Rebate, went out on April 15.
Taxpayers who filed before Mar. 15 were set to get the payments to help offset the cost of the federal carbon pricing regime. Those who file later can expect to get the payments six to eight weeks after their tax return is assessed.
Formerly called the Climate Action Incentive payment (CAIP), Canadians in Alberta, Ontario, Manitoba, Saskatchewan, New Brunswick, PEI, Nova Scotia, and Newfoundland and Labrador will receive the rebate through direct bank deposit or by cheque.
While Canadians in some provinces such as Alberta and Ontario will receive increased payments, taxpayers in provinces in Atlantic Canada will see their payments slightly reduced this year.
The rebate amounts are set annually based on how much carbon price Ottawa expects to collect in each province.
Before 2021, the CAIP was a refundable tax credit claimed annually on personal income tax returns. In 2022, the federal government replaced the tax credit with a quarterly payment administered by the CRA.
Here’s what to know about the rebate, how to get it and how frequently it’s given.
Who is eligible for the carbon rebate, and how much do they get?
The amount you will receive depends on where you live and the size of your household, but income levels aren’t a factor. A family of four will receive the following amounts quarterly:
- $450 in Alberta
- $300 in Manitoba
- $190 in New Brunswick
- $298 in Newfoundland and Labrador
- $206 in Nova Scotia
- $280 in Ontario
- $220 in Prince Edward Island
- $376 in Saskatchewan
An individual will receive $225 in Alberta, $150 in Manitoba, $140 in Ontario, $188 in Saskatchewan, $149 in Newfoundland and Labrador, $103 in Nova Scotia, $110 in Prince Edward Island and $95 in New Brunswick.
For spouses or common-law partners, the amount is $337.50 in Alberta, $225 in Manitoba, $210 in Ontario, $282 in Saskatchewan, $223.50 in Newfoundland and Labrador, $154.50 in Nova Scotia, $165 in Prince Edward Island and $142.50 in New Brunswick.
Residents of small and rural communities receive an extra 20 per cent supplement beyond the base rebate amount.
Canadians in British Columbia and Quebec do not receive the federal rebate because these provinces have their own carbon pricing schemes. In British Columbia, which has had its own carbon charge since 2008, residents receive the BC Climate Action Tax Credit, which amounts yearly to a maximum of $447 for an individual, $223.50 for a spouse or common-law partner and $111.50 per child ($223.50 for the first child in a single-parent family.)
Quebec implemented its own “cap and trade” program in 2014, which sets a limit on the amount of carbon that companies are permitted to burn. The system also offers the option for companies to buy the right to burn more than their quota by purchasing allowances, also known as carbon credits, from companies that burn less. By doing this, they exchange a portion of their right to emit greenhouse gasses.
How do you receive the carbon rebate?
Canadians do not need to apply for the rebate. If you have filed your income tax and benefit return, you will automatically receive the payments either by direct deposit or cheque in the mail.
If you’re registered for direct deposit, the rebate will likely appear in your bank accounts as “Climate Action Incentive,” although the exact wording may vary based on your bank.
How frequently are the rebates given?
The rebates are issued every three months, on the 15th of April, July, October and January. If the 15th falls on a Saturday, Sunday or federal statutory holiday, the payment will be issued on the last business day before the 15th.
What do you do if you were supposed to get the rebate and did not?
If you believe you should have received the rebate but did not, the Canada Revenue Agency says to wait 10 business days from the issuing date and then contact them at 1-800-959-8281 or 1-866-426-1527, if you’re in the territories.
So what is carbon fuel pricing, anyway?
The Trudeau government announced in 2018 that all provinces would need to implement a carbon-pricing system by April 1, 2019. Carbon pricing means charging a cost for fossil fuels such as gasoline, diesel and coal, and the goods made from them. The goal is to give companies and individuals a financial incentive to reduce their emissions.
Provinces and territories are allowed to create their own systems of carbon pricing as long as they meet or exceed the minimum requirements set by the federal government. If a province has no plan, or if it’s below the standard, the federal government applies a “backstop” that imposes the minimum price through federal taxes.
A carbon fuel charge is a fee imposed on each tonne of emissions from fossil fuels that includes oil products, such as gasoline and diesel, natural gas and coal-fired electricity.
The federal government says the majority of Canadian families receive more money back in rebates than they pay as a result of the system, and around 90 per cent of the carbon pricing proceeds go back to Canadians. The rebates are meant to help with cost-of-living challenges, Environment Minister Steven Guilbeault said in a statement in January.
With reports from Bill Curry, Adam Radwanski and The Canadian Press
Samantha Edwards