With effect from April 2025, the Canada Carbon Rebate (CCR), previously known as the Climate Action Incentive Payment (CAIP), will no longer be in effect, due to action from the Canadian government. This impacts eligible citizens since their final quarterly payments have already been issued and no further rebates will be forthcoming.
Understanding The Carbon Rebate
The CCR was initiated to mitigate the effects of federal fuel charges (the “carbon tax”) and paid out in tax-free quarterly installments to residents in provinces under the federal carbon pricing system. Eligible families could receive up to $1,800 annually, depending on their province, household size, and applicable rural supplements. The average payment was around $1,120.
The Computation And Distribution Of Payments
The CRA provided a portion of your total annual CCR four times a year—in April, July, October, and January—based on your tax return and your status. Those residing outside Census Metropolitan Areas (CMAs) received a 20% rural supplement, recognising their greater energy usage and reduced access to public transit.
The Reason For Program Discontinuation
In the same way that fuel taxes affect gas prices, on March 25, 2025, the Prime Minister Mark Carney eliminated the fuel tax on a federal level. Fuel taxes are closely related to carbon pricing and fuel rebates, so with the fuel tax gone, rebates ended as well. This meant no new payments from CCR, with the final ones scheduled for April.
Information All Canadians Should Have
- There will no longer be federal carbon rebate payments to consumers.
- The rebate was tax-exempt, so households did not have to declare them as income.
- Persons who qualified based on the residency and provincial requirements were issued the final CCR payments from April 22, 2025, for inclusion in the 2024 tax returns.
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