Cutting carbon tax from home heating likely to impact carbon tax rebate

As of Jan. 1, SaskEnergy bills and some SaskPower bills across the province have gone down because the carbon tax is no longer being collected.

However, that could pull down the amount paid out in carbon tax rebates in the province.

At the end of October, Premier Scott Moe announced his government would be taking the carbon tax off home heating to even up Saskatchewan with places that use home heating oil, from which the federal government had just removed the carbon tax. Moe said the feds should remove the tax for all home heating, or he would do it for them.

As of the new year, the carbon tax is being rebated back to customers on bills, but the provincial government hasn’t decided yet whether it will take the money from somewhere else and continue to pay the carbon tax amount to the federal government.

However, if the province doesn’t remit the money to the federal government, that will likely affect the carbon tax rebate.

“Pollution pricing rebates, which are direct support to families, are contingent on a province having the federal price on pollution — a framework which has been upheld by the Supreme Court of Canada,” Katherine Cuplinskas, the press secretary for the office of the federal minister of finance, said in a statement.

The federal government figures out the amount of the carbon pricing rebate based on how much it estimates it will receive in carbon tax from the provinces. If it estimates it will receive less from a province — like if a province refuses to pay the tax on home heating — then the rebate amount would go down.

Timing is a question in this case: The next rebate payment is Jan. 15, which is part of the year of payments already figured out.  If the federal government takes in more or less carbon tax in a year, then it will make adjustments to the payments in the following year.

The federal government hasn’t figured out the amounts of 2024-25 yet, and with the Government of Saskatchewan not having made its decision yet, it’s unclear when any change would affect rebate payments.

In the current year, the base amount for an individual in Saskatchewan is $170 per quarterly payment, with adjustments for the number of members in a household and a top-up for those who live in rural areas.

Saskatchewan’s Crowns minister

“Our decision to stop collecting the carbon tax on home heating was fundamentally about providing the same fairness to Saskatchewan families that were left out in the cold by the federal government’s decision to stop collecting the carbon tax on heating oil for Atlantic Canadian families,” Dustin Duncan. Saskatchewan’s minister responsible for SaskEnergy and SaskPower, said in a statement.

Much of Duncan’s reaction to the new information rests on his assertion that the carbon tax rebate for Atlantic provinces won’t be affected, though no evidence to support that could be found and his office did not provide any evidence that that is the case.

“There really are different rules for different parts of the country, based on whether they voted Liberal. Our expectation remains that the Prime Minister treat Saskatchewan families, and all families across Canada, with the same fairness,” Duncan said.