Carbon Tax Rebate: What it Was, Why it Ended

1. What was the carbon tax rebate?

The carbon tax rebate, which began in 2019, paid tax-free money to residents of certain provinces. These payments from the federal government helped offset the cost of federal pollution pricing charged on fossil fuels like natural gas and gasoline.

Under Canada’s carbon pollution pricing system, all money collected was returned to families, businesses, farmers and Indigenous groups.

2. Why did the carbon tax rebate end?

Prime Minister Mark Carney ended the rebate soon after being sworn into office on March 14, 2025.

The updated regulation stated that the fuel charge “created economic distortions, leading to efficiency losses in the economy.”

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It went on to state that eliminating the fuel charge “is expected to generate some economic gains that would benefit both households and businesses.”

The Canadian federal government began sending out the last regular quarterly Canada Carbon Rebate payments on April 22, 2025.

3. Who was eligible to receive the carbon tax rebate?

Under the carbon tax rebate, a single adult (or the first adult in a couple) received a certain amount based on their province of residence, with a spouse or common-law partner and each child under 19 receiving additional amounts, as long as the children have been registered under the Canada Child Benefit plan or the GST/HST credit.

4. How much was the carbon tax rebate?

The rebate amount varied by province and family situation and was not dependent on household income. For example, a single adult in Nova Scotia was eligible for a base amount of $110 from the final Canada Carbon Rebate payment in April 2025, while an eligible family of four in Alberta could have expected a base amount of $456 from that same payment, with an additional 20% top-up available for those in designated small and rural communities.

5. Are back payments available?

Individuals who were eligible for the Canada Carbon Rebate but didn't file tax returns in 2021, 2022, 2023 or 2024 may still receive Canada Carbon Rebate payments after submitting their tax returns, provided they file by the October 30, 2026 deadline.