Millions of Canadians will see “Canada Carbon Rebate” on their bank statements for the first time this week, as quarterly payments roll out amid ongoing political battles over the Liberals’ carbon pricing policy.
Ottawa sends the rebates to offset what people pay in carbon pricing when they buy fuel—so they’re not less worse off as a result. People who do things to lower their fuel use are even better off, because they still get the same rebate but pay less in carbon pricing.
The government says this is the first time all banks will label the payment as the Canada Carbon Rebate, after years of inconsistent and vague phrasing on bank statements.
The quarterly rebate will go to Canadians who filed their income tax while living in Alberta, Saskatchewan, Manitoba, Ontario, and all four Atlantic provinces.
The payments vary by household size and province, while those in rural areas get a top-up. Rural residents will see a boost in their quarterly rebate, with a 20% top-up along with a retroactive 10% payment for April and July.
Economists are widely in favour of carbon pricing, arguing it is the most cost-effective way to reduce emissions, but the Liberals’ policy is facing pushback at the provincial and federal levels, with the Conservatives calling for a “carbon-tax election” to bring down the cost of living.
The federal NDP and some of their provincial counterparts have distanced themselves from the policy, which they previously supported.
British Columbia, Quebec, and Northwest Territories have their own carbon pricing system for consumers, so residents there don’t receive the federal payment. Yukon and Nunavut use the federal system but have an agreement to distribute the proceeds themselves.
The parliamentary budget officer says most Canadians get back more from the rebates than they pay.
He also says, though, that the economic impact of carbon pricing could lower wages over time, erasing that benefit for some Canadians. The government argues that climate change itself can cause economic harm if it is left unchecked.
Ottawa has been battling with banks about how the deposits are labelled since they moved to quarterly payments for the rebates in 2022.
Many Canadians were confused—or didn’t even realize they were getting a rebate— when payments showed up with vague labels like “EFT deposit from Canada,” “EFT Credit Canada” or just “federal payment.”
Some banks previously argued the term “Canada Carbon Rebate” went beyond their 15-character limit on deposit descriptions.
This report by The Canadian Press was first published Oct. 15, 2024.
