Canadians Owed Over $200M in Carbon Tax Rebates, Says CRA

Families in certain Canadian provinces are owed millions in carbon tax rebates after the controversial program brought in much more than expected in 2019, according to the Canada Revenue Agency.

Finance Canada anticipated bringing in $2.3 billion under the carbon tax in 2019, but overshot, raising $2.42 billion instead. Under the law, according to Huffington Post Canada, that excess must be returned to the provinces where it originated, which are Ontario, Manitoba, and New Brunswick.

A portion, 10 per cent, will go to public services, including schools, hospitals, and local government, as well as small businesses. The remainder must go to families in the form of an income tax rebate.

The federal government says that it will adjust future rebates to make up the difference, with 2021 rebates ranging, for a family of four, from $600 in Ontario to $1,000 in Saskatchewan.

Only one carbon tax rebate can be claimed by each household and the total amount depends on family size and the rate of fuel consumption in the province.

In 2019, 8.7 million people claimed the Climate Action Initiative when they filed their taxes, Canada Revenue reported.

Critics say that Ottawa should have made the accounting clearer from the outset.

“If government is taking from taxpayers, they should be able to account for it in a way that makes sense and is clearly presented,” environment critic Dan Albas told The Canadian Press. “And that’s not the case here.”

Under the carbon tax program, rebates are given out to participating provinces before the tax is assessed. The tax will gradually rise $10 per tonne each year until 2022 and then by $15 each year until 2030. The government planned to adjust rebates each year, but could not take into account a global pandemic that skewed energy use, resulting in much bigger carbon tax rebates.

The carbon tax was implemented as a way for Canada to meet its obligations under the Paris Agreement. Ultimately, the program will assess a tax on every tonne of carbon. For reference, a typical passenger vehicle produces one tonne of carbon approximately every four months.

Currently, the tax is assessed at the fuel pump, with participating provinces receiving carbon tax rebates each year; however, the carbon tax is controversial, reportedly facing legal challenges in Canada’s highest courts.

Are you a resident of Ontario, Manitoba, or New Brunswick? Are you going to claim a carbon tax rebate? Tell us about it in the comment section below!

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