Ottawa owes Alberta small businesses $4,095 each in stalled carbon tax rebates from the past five years

With the recent confirmation from Ottawa that it owes Canada’s small and medium-sized businesses over $2.5 billion in carbon tax (fuel charge) rebates, the Canadian Federation of Independent Business (CFIB) is calling on the federal government to immediately disperse the funds equally to all SMEs as it does with the consumer carbon rebate.

Alberta’s share of the $2.5 billion works out to just under $720 million. If the federal government were to distribute the $720 million as a onetime payment to all active, incorporated businesses in the province, each Alberta SME would get $4,095.

“That’s a big chunk of money that small business owners could really use right now. It’s deeply unfair that five years into the program, Ottawa is still sitting on over $2.5 billion it owes to small firms,” said CFIB president Dan Kelly. “Enough is enough. The government must act now and return the promised carbon tax revenues to all small businesses in the eight provinces under the federal backstop.”

For the 2019-20 and 2023-24 fiscal years, the average rebate amount per business would be $2,500 for all provinces.

Recently, the federal government also announced it will cut SME rebates promised to small businesses to 5% from 9% starting in 2024.

“Rather than viewing small businesses as a partner on climate change, the federal government clearly sees them as the just the source of a big bag of cash to deal with political sensitivities over the carbon tax,” Kelly added. “While small firms take no issue with increased rebates for rural residents and Indigenous organizations, it is outrageous that the tiny sliver of rebate revenue aimed at small businesses would be cut nearly in half to pay for it.”

CFIB continues to call for fairness for small businesses and push the federal government to:

• Immediately return the $2.5 billion owed to all small businesses since 2019.

• Scrap the idea of returning the SME allocation only to “emissionsintensive, trade-exposed” businesses in favour of a simple rebate for all SMEs.

• Scrap the plan to reduce the SME share of carbon tax revenue from 9% to 5% in 2024 and rebate it annually.

• Increase the SME rebate to 40% of carbon tax revenue - the share CFIB estimates comes from business.

• Pass Bill C-234 as originally proposed to exempt natural gas and propane used for on-farm activities, including grain drying and heating farm buildings.

• Freeze the carbon tax rate at its current level.

• Exempt all heating fuels, including natural gas.

“Alberta small businesses are rightfully owed what Ottawa has promised them in carbon tax revenues and a $4,095 rebate will go a long way for those businesses that are already facing high fuel and energy costs.” said Andrew Sennyah, Alberta senior policy analyst. “The whole carbon tax system needs to be fixed immediately to ensure small businesses are treated fairly.”

Small businesses can add their voice to CFIB’s fight for fairness by signing CFIB’s petition.