Ottawa exempting home heating oil from carbon tax for 3 years, Trudeau says
CBC
The government is creating a carve-out for the carbon tax on home heating oil, Prime Minister Justin Trudeau said Thursday.
The government will exempt home heating oil from the tax for three years, double the rural supplement in the rebate program and offer new programs Trudeau said will help rural Canadians switch to electric heat pumps.
"This is an important moment where we're adjusting policies so that they have the right outcome. We are doubling down on our fight against climate change and keeping true to the principles that we're supporting Canadians while we fight climate change," Trudeau told a press conference.
While the exemption applies nationwide, Trudeau said the policy will help Atlantic Canada in particular. Thirty per cent of homeowners in the region still use furnace oil to heat their homes.
"We've heard clearly from Atlantic Canadians through our amazing Atlantic MPs that since the federal pollution price came into force ... certain features of that pollution price needed adjusting to work for everyone," he said, surrounded by a number of Liberal MPs from the region.
The federal carbon tax applies in provinces and territories that don't have carbon pricing systems that Ottawa considers sufficient to lower greenhouse gas emissions. Households in those provinces receive a rebate to offset the tax.
The federal carbon tax took effect in the Atlantic provinces in July, after Ottawa deemed the provincial alternatives insufficient.
Trudeau said the pause is meant to give rural Canadians more time to switch to alternative sources like electric heat pumps.
Last year, the government earmarked $250 million for provinces and territories to help low-income households make the switch from fossil fuels to other sources. On Thursday, Trudeau said his government would be boosting that grant for lower-income households in Atlantic Canada to make the switch away from fossil fuels easier.
"We are switching to heat pumps off home heating oil as a region in Atlantic Canada and as a country," he said.
The government already gives a supplement to residents of rural and small communities that increases the rebates in their province by 10 per cent to account for increased energy needs and reduced access to transportation options. That top-up will rise to 20 per cent in April.
The carbon tax is currently priced at $65 per tonne of emissions and is set to rise by $15 every year until 2030.
Trudeau's announcement comes as his Liberal Party polls well behind the Conservatives under leader Pierre Poilievre.
Poilievre has used the carbon tax as a line of attack against the Liberals. His latest "axe the tax" rally is set for Thursday night in Windsor, N.S.
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