Climate Action Incentive payment amounts for 2023-24

Backgrounder

Continuing to Make Sure Most Households Get More Money Back Than They Pay

November 22, 2022

The federal government applies a price on pollution in jurisdictions that do not have their own pollution pricing systems which meets the federal benchmark. Specifically, in 2023-24, the federal fuel charge will continue to apply in Alberta, Saskatchewan, Manitoba, and Ontario, and will come into effect as of July 1, 2023 in Newfoundland and Labrador, Nova Scotia, and Prince Edward Island.

The Government of Canada does not keep any direct proceeds from pollution pricing. All direct proceeds from the federal fuel charge are returned to the province or territory of origin in the following way:

  • For those jurisdictions that have voluntarily adopted the federal system, direct proceeds are returned to the governments of those jurisdictions.
  • For those provinces that do not meet the federal stringency requirements in 2023-24 — Alberta, Manitoba, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, and Saskatchewan — 90 per cent of direct proceeds from the federal fuel charge will be returned to residents of those provinces through Climate Action Incentive (CAI) payments. The other 10 per cent will be used to support small businesses and Indigenous groups.
    • Proceeds relating specifically to the use of natural gas and propane by farmers are returned directly to farmers via a refundable tax credit.
    • Fishers and farmers are currently exempt from paying the federal fuel charge on gasoline and light fuel oil (e.g., diesel) used for eligible fishing and farming activities in provinces currently under the federal program. These exemptions will continue to apply in Newfoundland and Labrador, Nova Scotia, and Prince Edward Island after July 1, 2023.

Climate Action Incentive Payments

The government began delivering CAI payments to Canadians on a quarterly basis starting in July 2022. This approach returns fuel charge proceeds to households on a more regular basis, with 8 out of 10 households getting more money back than they pay.

In order to receive their CAI payment, Canadians need to file their annual tax return. If they are eligible for the 10 per cent supplementary amount for residents of small and rural communities, they will need to tick the corresponding box on their tax return, with the exception of Prince Edward Island residents. In Prince Edward Island, all individuals receive the rural supplement amount, and are not required to indicate this on their tax return. The government will evaluate an increase to the rural supplement for future years.

CAI payments for 2023-24 will be disbursed as follows:

  • Residents of Alberta, Manitoba, Ontario, and Saskatchewan will receive four equal quarterly payments (April 2023, July 2023, October 2023, and January 2024), as these provinces are already covered by the federal price on pollution.
  • Since the federal fuel charge will only come into effect as of July 1, 2023 in Newfoundland and Labrador, Nova Scotia, and Prince Edward Island, residents of these provinces will receive three equal quarterly payments (July 2023, October 2023, and January 2024) in the 2023-24 fiscal year and four payments in the year after that.
Table 1
Quarterly Climate Action Incentive Payment Amounts as Specified by the Minister of Finance, 2023-24
AB MB ON SK NL NS PEI*
First Adult $193 $132 $122 $170 $164 $124 $120
Second Adult $96.50 $66 $61 $85 $82 $62 $60
Each Child $48.25 $33 $30.50 $42.50 $41 $31 $30
Family of 4 $386 $264 $244 $340 $328 $248 $240
Payment Dates April 2023
July 2023
October 2023
January 2024
July 2023
October 2023
January 2024

*The amount for PEI includes the 10 per cent rural supplement, as all residents are eligible. Rural residents in other provinces will also receive the 10 per cent rural supplement, which is not reflected in this table.

Table 2
Annual Climate Action Incentive Payments, using 2023-24 amounts1
AB MB ON SK NL NS PEI2
First Adult $772 $528 $488 $680 $656 $496 $480
Second Adult $386 $264 $244 $340 $328 $248 $240
Each Child $193 $132 $122 $170 $164 $124 $120
Family of 4 $1,544 $1,056 $976 $1,360 $1,312 $992 $960
Payment Dates April 2023
July 2023
October 2023
January 2024
July 2023
October 2023
January 2024

1 Residents of Newfoundland and Labrador, Nova Scotia, and Prince Edward Island are not eligible for an April 2023 payment because the federal fuel charge will only apply to these provinces as of July 1, 2023. Annual entitlements for Newfoundland and Labrador, Nova Scotia, and Prince Edward Island are for explanatory purposes: calculations use four quarterly payments at the 2023-24 rate, while the fourth quarterly payment in these provinces, in April 2024, notionally reflects future 2024-25 amounts.

2 The amount for Prince Edward Island includes the 10 per cent rural supplement, as all residents are eligible. Rural residents in other provinces will also receive the 10 per cent rural supplement.

CAI payment amounts have been adjusted in Alberta, Manitoba, Ontario, and Saskatchewan to account for over- and under-distributions of proceeds in previous years. This is in line with the government's commitment that any actual variance between the proceeds originating in a given jurisdiction and the amount of proceeds returned to that jurisdiction would be addressed through changes in future payment amounts to that jurisdiction. Further details on this reconciliation will be provided in the forthcoming Greenhouse Gas Pollution Pricing Act: Annual report for 2021.

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