Canadian Carbon Tax

Canada is proceeding with the carbon tax plan that you may have heard about in the news.  And they are moving at an expedited rate.

The carbon tax will be very similar in operation to the fuel tax and will be implemented in 2 phases throughout Canada, beginning with the provinces of Manitoba, New Brunswick, Ontario, and Saskatchewan, followed by Nunavut and the Yukon.  If you operate in or through these provinces you WILL NEED TO REGISTER BY APRIL 1, 2019 or JULY 1, 2019.  Below are instructions on how to register with the Canada Revenue Agency (CRA). There will also be a quarterly filing requirement similar to that of the International Fuel Tax Agreement (IFTA).

It is not yet clear how enforcement of this new carbon tax will proceed as the CRA has no relationship with US operators and therefore limited ability to enforce.  Furthermore, there has been no consultation on the issue or outreach to the industry.  ABA worked withOntario Motor Coach Association (OMCA) to set up a webinar with the CRA to lay out any additional details and answer questions.

View the Webinar Slides Here

Please note, that according to the legislation creating this new tax, there are potential penalties for non-compliance of up to $2,000 (CD). The effective tax rate for operators who fill up on fuel while operating in Canada will be an additional $0.20 (CD) per gallon or about $0.053 (CD) per liter.

Fuel Charge Registration

Who Has to Register

For the purpose of the fuel charge, you may be required or permitted to register with the CRA under the Greenhouse Gas Pollution Pricing Act.

Persons that have business activities in a listed province (Manitoba, New Brunswick, Nunavut, Ontario, Saskatchewan, or Yukon), such as producers, distributors, emitters, importers, certain users of fuel, or combustible waste, as well as persons that are air, marine, rail, or road carriers, may have to register for one or more of the following types of registration:

  • distributor
  • importer
  • emitter
  • user of fuel
  • user of combustible waste
  • air carrier
  • specified air carrier
  • marine carrier
  • specified marine carrier
  • rail carrier
  • specified rail carrier
  • road carrier

Pretty much all motorcoach operators should be registering as a “Road Carrier”.

To find out if you are required or permitted to register, see Fuel Charge Notice FCN1, Registration Under the Greenhouse Gas Pollution Pricing Act. Should you have technical enquiries with respect to the application of the Greenhouse Gas Pollution Pricing Act, contact one of the regional excise offices at Contact Information – Excise Duties, Excise Taxes, Fuel Charge and Air Travellers Security Charge.

When to Register

You can submit your fuel charge registration forms electronically or by mail.

You must apply for registration before:

  • April 1, 2019 if your business activities are in Manitoba, New Brunswick, Ontario, or Saskatchewan
  • July 1, 2019 if your business activities are in Nunavut, or Yukon

How to Register

To register for the fuel charge program, use Form L400, Fuel Charge Registration.

If you have activities in more than one listed province, only one registration application is needed.

To indicate your registration type(s) and the type(s) of fuel that you use, transfer, deliver, import in, or produce, and any combustible waste burned in each listed province, use Form L400-1, Fuel Charge Registration Schedule.

If you are required to register as a road carrier, use Form L400-2, Fuel Charge Registration Schedule – Road Carrier.

The processing of the fuel charge registration may be delayed in the case of missing or incomplete information.

Registration forms can be submitted electronically using the "Submit documents" function in My Business Account. If you submit your registration electronically, you will be provided with the confirmation number of your submission. This confirmation number should be retained for follow up on the status of your application if required.

You can also send your completed forms by mail to the following address:

Sudbury Tax Centre
Fuel Charge Program
Post Office Box 20000, Station A
Sudbury ON  P3A 5C1

After You Submit Your Application

When your registration is processed, the CRA will advise you of your registration number and effective date of registration. You may also login to My Business Account to view the registration information and this will allow you to view your registration confirmation letter.

If more than 60 days have passed since you submitted your registration application, you can call 1-866-959-7797 to inquire about the status of your application.

What Else?

If you operate exclusively into provinces that were not listed above (Quebec, British Columbia, Alberta, Nova Scotia, or Prince Edward Island), then you do not need to register or report.