Tax Credit Payment Rates to Return Fuel Charge Proceeds to Farmers for 2024-25 and 2025-26

Under the Pan-Canadian Approach to Pricing Carbon Pollution, the federal government applies a federal price on pollution in jurisdictions that do not have their own system.

The Government of Canada does not keep any direct proceeds from pollution pricing. All direct fuel charge proceeds are returned in the province or territory of origin. In provinces where the federal fuel charge applies, over 90 per cent of those proceeds are returned directly to Canadians through the quarterly Canada Carbon Rebate, and the remainder is being returned to small- and medium-sized businesses, Indigenous governments, and farmers.

Recognizing that many farmers use natural gas and propane in their operations, the federal government provides a refundable tax credit to return fuel charge proceeds to farming businesses that operate in provinces where the federal fuel charge applies.

The Minister of Finance has the authority under the Income Tax Act to specify payment rates for eligible farming expenses that are incurred in the 2024 and 2025 calendar years, which correspond to returns of fuel charge proceeds for the 2024-25 and 2025-26 fuel charge years respectively, and the designated provinces in which these payment rates will apply.

Designated Provinces where the Farmers Tax Credit payment rate is applicable Payment rate per $1,000 in eligible farming expenses
Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador 2024 2025
$2.29 $2.50

Eligible farming businesses may make claims for these amounts on their tax returns that include the 2024 and 2025 calendar years.

Page details

Date modified: