Carbon Tax Rebate: New Brunswick's Offer

New Brunswick's first-ever carbon tax rebate is on the way, with the province scrapping its own carbon tax in favour of the federal system. This means that New Brunswickers will be receiving a rebate through direct deposit or by cheque. The rebate is paid for with the proceeds from the federal carbon tax, which came into effect on July 1 across Atlantic Canada. The amount of the rebate depends on the size of the household. For example, a single New Brunswicker will get a rebate of $92 every quarter, while a family of four will receive $184. This week, residents will receive a double payment for the first instalment, which covers the period from July to December 2023.

Who is eligible for the rebate?

To be eligible for the rebate, officially known as the Climate Action Incentive Payment (CAIP), you need to be a Canadian resident for tax purposes at the start of the month in which the payment will be issued. So, for example, if the payment is issued on April 15, you must be a resident from April 1. You must also be a resident of a province that issues the CAIP. Additionally, you need to be 19 or over. Individuals under 19 can qualify if they have or previously had a spouse or common-law partner, or if they are a parent who lives or used to live with their child.

Under the CAIP, a single adult (or the first adult in a couple) receives 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. In families where children live with a parent part-time, the parent can still receive 50% of the CAIP payment.

To receive the rebate, residents need to have filed their taxes. The Canada Revenue Agency calculates your eligibility for the rebate based on your last income tax return. As long as you filed your taxes in the spring, you don't need to do anything to get the rebate. It will be deposited directly into your bank account if you have set up direct deposit from the CRA for any income tax refunds. Otherwise, you will receive a cheque in the mail.

If you are a newcomer to Canada, you need to fill out some forms to apply for the rebate. These can be found on the CRA website under the heading "Are you a newcomer to Canada?"

How much will individuals and families receive?

The amount of money that individuals and families receive as a carbon tax rebate in New Brunswick depends on their household composition and whether they live in a rural community.

For the first rebate payment in October 2023, a single New Brunswicker will receive a rebate of $184, while a family of four will receive $368. This first payment is a double payment, covering the July-September and October-December quarters. For subsequent quarters, a single adult will receive $92, and a family of four will receive $184. Residents of small and rural communities are entitled to an additional 10% supplement on top of the basic rebate amount. This means that a single adult in a rural community will receive $202.40 for the first payment and $101.20 for subsequent quarterly payments, while a family of four in a rural community will receive $404.80 for the first payment and $202.40 for subsequent quarterly payments.

It is important to note that these rebate amounts are less than those in other Atlantic provinces, as New Brunswick's economy emits less carbon due to wood and electricity-based heating that are not taxed directly.

To receive the carbon tax rebate, residents of New Brunswick need to have filed their taxes. The rebate will be delivered by direct deposit or cheque.

How will the rebate be paid?

The rebate will be paid in the form of a cheque or direct deposit every three months. The first rebate was due on 15 October 2023, with the next payment scheduled for January 2024.

If you have set up direct deposit from CRA for any income tax refunds, you will receive the rebate the same way. It will show up as a deposit labelled "climate action incentive". If you are not registered for direct deposit, a cheque will be sent by mail. CRA asks that you allow 10 days for it to arrive before contacting them.

The rebate is paid for with the proceeds from the federal carbon tax, which came into effect on 1 July 2023 across Atlantic Canada.

When will the rebate be paid?

The first-ever carbon tax rebate in New Brunswick is paid out quarterly. The first instalment was paid in October 2023, with a double payment for the first instalment. The second quarterly payment will take place in January 2024.

The rebate is paid by direct deposit or cheque. To receive the rebate, residents must have filed their taxes.

The rebate is paid to households in the following amounts:

• $92 every quarter for a single New Brunswicker
• $184 per quarter for a family of four ($92 for the first adult, $46 for the spouse, and $23 for each child under the age of 19)
• $276 per quarter for a couple
• $368 per quarter for a family of four, including the 10% rural top-up

The rebate is a federal initiative, not a provincial one. It is called the Climate Action Incentive and is paid for with proceeds from the federal carbon tax.

Why is the rebate being paid?

The rebate is being paid because of the introduction of the federal carbon tax, which will increase costs for New Brunswickers. The federal carbon tax will increase the cost of almost everything, including groceries, heat, and other necessities. For example, a 50-litre tank of gas will cost an extra $10.13 at the pump, and the annual fuel charge for a residential natural gas user is estimated to be $403.36.

The rebate, called the Climate Action Incentive, is intended to offset these increased costs and put money back in the pockets of New Brunswickers. The rebate is paid for with the proceeds from the federal carbon tax. The Government of Canada does not keep any direct proceeds from pollution pricing and returns all proceeds to the province or territory of origin. In New Brunswick, 90% of direct proceeds from the federal fuel charge will be returned to residents through quarterly Climate Action Incentive payments, with the remaining 10% used to support small- and medium-sized businesses and Indigenous groups in the province.

The rebate also serves as an incentive for consumers and businesses to choose greener options. Every time a purchasing decision is made, there is a financial incentive to select more sustainable alternatives. This is in line with New Brunswick's commitment to meeting Canada's goal of reducing emissions by 40-45% below 2005 levels by 2030. The province has already made significant progress, reducing its greenhouse gas emissions by 39% since 2005 and setting a provincial target of 47% below 2005 levels by 2030.

The rebate is also a result of the New Brunswick government's decision to scrap its own carbon tax, which did not include a rebate, in favour of the federal system. Premier Blaine Higgs made this decision to provide direct financial relief to residents facing soaring grocery and housing costs. By switching to the federal system, New Brunswickers would receive the rebate payments, which the previous provincial carbon tax did not offer.

Frequently asked questions