Some Saskatchewan residents received a carbon tax rebate payment on Friday.
The Climate Action Incentive Payment (CAIP) is a tax-free payment. On its website, the federal government says it helps offset the cost of federal pollution pricing.
The payment is available to Alberta, Saskatchewan, Manitoba and Ontario residents.
Other provinces have their own carbon-pricing systems that meet federal minimum standards.
The first CAIP was issued to entitled Saskatchewan residents whose 2021 income tax and benefit has been processed as of July 15.
Other payments will be issued on Oct. 15 and January 15, 2023, according to the Canada Revenue Agency.
The July 15 payment includes a retroactive payment for April.
For the 2021 base year, the Saskatchewan program allows for an annual credit of $550 for an individual, $275 for a spouse/common-law partner, $138 per child under 19 and $275 for the first child of a single-parent family.
Residents who get tax refunds by direct deposit should have also gotten the CAIP by direct deposit.
“If you have a tax debt with the CRA, the CAIP will be applied to amounts owing for income tax balances or amounts owing to other federal or provincial government programs,” the federal government says.
Those who did not receive their CAIP on the expected date are asked to wait 10 working days before contacting the CRA.
Moshe Lander, economics professor at Concordia University, said it’s important to note Friday’s payment was a double payment.
“The mistake that Canadians are going to make, and they’re going to end up getting very angry in three months’ time, they’re going to say, ‘Why am I only getting half of what I got in July?’”
The Canadian Taxpayers Federation recently spoke out saying that Canadians were paying more for the carbon tax than they were getting back.
“If you make the rebate too generous, you could actually have this perverse situation that you’re actually profiting from the tax — that you pay less than the tax than you get back in the rebate,” Lander said.
“There has to be kind of a tipping point that you’re not necessarily paying the full tax, but you’re also not profiteering from something that we should be paying if it weren’t for inflation.”
In a statement, federal Minister of Environment and Climate Change Steven Guilbeault said pollution pricing has been recognized globally as “the most efficient policy to reduce emissions as it imposes the lowest overall cost on the economy.”
“The (parliamentary budget officer’s) own analysis confirmed that the majority of households will receive more in payments than they face in direct costs due to pollution pricing,” Guilbeault added.
— with a file from Global’s Ryan Rocca
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