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Useful Contacts

Contact us with your questions about the motor fuel tax or carbon tax.

Phone: 1-877-388-4440 (Toll-free)

Fax: (250) 387-5882

Email: CTBTaxQuestions@gov.bc.ca

Motor Fuel Tax and Carbon Tax

When fuel is manufactured or imported, the business that sells the fuel for the first time in the province must be appointed as a collector.

A collector is required to remit security to us equal to the tax that will be collected from the end purchaser on retail sales. The collector is reimbursed this cost by charging the deputy collector or wholesaler security or by collecting tax from the end purchaser.

The deputy collector or wholesaler is then reimbursed by charging security to the retail dealer, who in turn is reimbursed by collecting tax from the end purchaser.

This process protects provincial revenue and reduces the number of businesses that need to register to collect and remit motor fuel and/or carbon tax to us.

The following are exceptions to the above:

  • If you sell natural gas to an end purchaser, you’re required to register, collect taxes on sales to end purchasers and remit those taxes
  • If you sell fuel that is imported by ship from outside Canada, under specific circumstances you may be required to remit security, collect security and report the import of that fuel
  • If you manufacture or import fuel for your own use, you’re required to report and remit taxes on the fuel you have used
  • If you sell to a purchaser that qualifies for an exemption, you may apply for a refund of security you paid

For full details, see the bulletin Fuel Sellers (MFT-CT 001) (PDF).

Motor Fuel Tax

The motor fuel tax applies to fuels sold for use or used to power internal combustion engines such as:

  • cars
  • trucks
  • recreational vehicles
  • boats
  • ships
  • airplanes
  • locomotives
  • equipment such as bulldozers, skidders, chain saws and generators

Motor fuel tax on clear gasoline and clear diesel fuel is made up of provincial and dedicated taxes.

  • The provincial taxes go to general revenue
  • Dedicated taxes, which apply in certain regions of the province, go to the South Coast British Columbia Transportation Authority (Translink), the British Columbia Transit Authority and the British Columbia Transportation Financing Authority to help finance transportation projects

Carbon Tax

The carbon tax applies to the purchase or use of fuels such as gasoline, diesel, natural gas, heating fuel, propane and coal, and to peat and tires when used to produce energy or heat.

The carbon tax puts a price on carbon emissions to encourage individuals, businesses, industry and others to use less fuel and reduce their greenhouse gas emissions.

The initial tax rate was relatively low and has increased gradually to allow families and businesses time to reduce their emissions. The tax is also intentionally broadly based and paid by almost all those who consume fuels in the province.

The carbon tax is revenue neutral, meaning every dollar generated by the tax is returned to British Columbians through reductions in other taxes.

Tax Rates

Motor fuel tax rates are calculated at a fixed priced per litre. However, the tax rate varies depending on the type of fuel, whether the fuel is clear or coloured, the use of the fuel, the location of the sale, and the person buying the fuel.

Carbon tax rates are based on a dollar amount per tonne of CO2 equivalent emissions. Since different fuels generate different amounts of green house gases (GHG) when burned, the dollar amount per tonne is translated into tax rates for each specific type of fuel.

See the bulletin Tax Rates on Fuels (MFT-CT 005) (PDF) for current motor fuel tax and carbon tax rates.