FCN16 Removal of the fuel charge

Fuel Charge Notice
March 2025

Except as otherwise noted, all statutory references in this publication are to the provisions of the Greenhouse Gas Pollution Pricing Act. In addition, all references to the "Regulations" are to the Regulations Amending Schedule 2 to the Greenhouse Gas Pollution Pricing Act and the Fuel Charge Regulations. The information in this publication does not replace the law found in the Act and its regulations.

If this information does not completely address your particular situation, you may refer to the Act or relevant regulation, or contact your CRA regional excise office for additional information. The offices are listed at Contact information – Excise and Specialty Tax Directorate.

On this page

• Background
• Current status
• Registration
• Filing and reporting
• Returns for business activities in listed provinces
• Exemption certificates
• Information on registration cancellation
• Inspections
• Records
• Enquiries

Background

The Government of Canada implemented a federal carbon pollution pricing system that applies in provinces and territories that requested it or that do not have a carbon pricing system that meets the federal stringency requirements. Schedule 1 to the Act includes the list of provinces and territories where the federal fuel charge applies. They are known as listed provinces and include Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Nunavut, Ontario, Prince Edward Island, Saskatchewan, and Yukon. The Greenhouse Gas Pollution Pricing Act came into force on June 21, 2018, and is composed of two key parts.

Part 1 is administered by the Canada Revenue Agency (CRA) and provides for a charge, known as the fuel charge, which applies to 21 types of fuel and to combustible waste. For a complete list of the rates, go to Fuel charge rates.

Part 2 is administered by Environment and Climate Change Canada (ECCC) and provides an output-based pricing system (OBPS) for industrial facilities. For more information on the OBPS, go to the OBPS website.

Current status

On March 14, 2025, the Government of Canada announced that it will be removing the fuel charge effective April 1, 2025, by setting all fuel charges rates to zero. The fuel charge no longer needs to be reported or paid on all types of fuel and combustible waste in listed provinces in respect of activities after March 31, 2025.

The OBPS under Part 2 of the Act will continue to apply in listed provinces where it currently applies. Any changes made to the Act hereafter will be communicated to persons by the Department of Finance and ECCC.

Registration

Persons that were neither registered nor required to be registered on March 31, 2025, are no longer required or permitted to register for the fuel charge after that date. 

Filing and reporting

Effective April 1, 2025, fuel charge filing requirements for registrants will cease. Registrants must still file any outstanding fuel charge returns and pay any amounts owing for reporting periods prior to April 1, 2025.

However, if a registered rail carrier or registered specified rail carrier calculates a positive annual net fuel adjustment for the specified year of April 1, 2024, to March 31, 2025, they must report it using a Form B400, Fuel Charge Return – Registrant, and related schedule for September 2025. The return and any amounts owing are due by October 31, 2025.

Effective April 1, 2025, obligations for non-registrants to report and pay a charge will cease. Affected non‑registrants must still report and pay any amounts owing for reporting periods prior to April 1, 2025, on a fuel charge return for non-registrants.

Persons subject to a charge for fuel held in a listed province on April 1, 2025, are not required to file a Form B402, Fuel Charge Return on Fuel Held in a Listed Province on Adjustment Day, or related schedule on that day. Persons must still file any outstanding adjustment day returns and pay any amounts owing for adjustment days up to and including April 1, 2024.

Returns for business activities in listed provinces

Registered persons other than road carriers are required to file a Form B400 and related schedule for the period from March 1 to March 31, 2025, by April 30, 2025. 

For registered road carriers, a Form B400 and related schedule for the period from January 1 to March 31, 2025, are required to be filed by April 30, 2025.

Exemption certificates

Exemption certificates no longer apply in respect of a delivery of a type of fuel in a listed province on or after April 1, 2025. Exemption certificates must still be retained for six years after the end of the year to which they relate.

Information on registration cancellation

Effective November 1, 2025, all fuel charge accounts (CT endorsement) will be cancelled without any action required by registrants and affected non-registrants. 

Inspections

Section 141 of the Act provides that, for purposes of the administration and enforcement of Part 1, the CRA may inspect, audit, or examine the records, processes, property, or premises of a person that may be relevant in determining the obligations of that person under this Part or the amount of any rebate to which that person is entitled under this Part and whether that person is compliant with this Part.

Persons that have business activities in listed provinces related to any of the 21 types of fuel or to combustible waste will continue to be subject to inspections after April 1, 2025. Any assessment or refund will be processed as necessary. The administration and enforcement provisions of the Act that are related to penalties, collection, and confidentiality of information will continue to apply.

Records

Section 104 of the Act provides that every person that pays or that is required to pay a charge or file a return and every person that makes an application for a rebate must keep all records that are necessary to enable the determination of the person’s liabilities and obligations or the amount of the rebate to which the person is entitled and to determine whether the person has complied with their obligations. Persons that are required to keep records must retain them for a period of six years after the end of the year to which the documents relate.

Enquiries

For any questions related to the Act, contact the following office:

Excise and Specialty Tax Directorate
Canada Revenue Agency
Place de Ville Tower A 5th floor
320 Queen St
Ottawa ON  K1A 0L5
Phone: 1-866-330-3304 

Further information