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Section One: PRICING CARBON POLLUTION IN CANADA
How is the Greenhouse Gas Pollution Pricing Act (GGPPA) fuel charge program administered in Canada?
The GGPPA is administered by the Canada Revenue Agency (CRA)
What fuels are impacted by the fuel charge?
The fuel charge applies to 21 types of fuel and combustible waste including gasoline, diesel, natural gas, coal, and more.
What fuel charge rates apply in jurisdictional provinces?
- April.1, 2019 – C$20/tonne in Ontario, Saskatchewan, Manitoba, and New Brunswick and July 1, 2019 – Nunavut and Yukon
- April 1, 2020 – C$30 – cost of 6.6 cents/litre on gasoline, 8.1 cents/L on diesel, and 5.9 cents/cubic metre on marketable natural gas
- Rate increase by C$10 annually until hitting C$50 in 2022
Do the federal carbon fuel charge rates apply in all provinces in Canada?
- Carbon fuel charge rates under the federal GGPPA – Part 1 regulations apply to the jurisdictional provinces implementing full backstop or certain hybrid carbon programs
- Other provinces including Quebec, British Columbia, and New Brunswick have respective programs that incorporate a carbon pricing component aligning with the federal system
How are proceeds from the carbon pricing program being allocated?
- All proceeds are returned to their jurisdictional governments and to residents through the “Climate Action Incentive” program for the year after filing their tax returns
- Proceeds support other affected non-industrial sectors – schools, hospitals, small and medium-sized businesses, colleges and universities, municipalities, not-for-profits, and Indigenous communities
How can my facility mitigate the carbon charges - opportunities?
- GGPPA – Part 1 provides for 12 types of registrations including industrial emitters and road carriers
- Certain business activities require mandatory registration (cross-border road carriers) while most are voluntary (emitters registered as OBPS voluntary participants) – registration certificates allow for fuel tax exemptions from suppliers at source
- Certain sectors – such as greenhouses and farms are eligible for partial relief (80%) through fuel charge exemption certificates
- All registration and fuel charge administration is completed through the Canada Revenue Agency (CRA)
- Facilities located in provinces not covered under the GGPPA fuel charge regulations – programs are offered through provincial initiatives (i.e. Quebec)