British Columbia's Carbon Tax

B.C.’s carbon tax provides a signal across the economy to reduce emissions while encouraging sustainable economic activity and investment in low carbon innovation.

In 2008, the province implemented North America’s first broad-based carbon tax, proving that it is possible to reduce emissions while growing the economy. Between 2007 and 2015, provincial real GDP grew more than 17%, while net emissions declined by 4.7%.

The carbon tax applies to the purchase and use of fossil fuels and covers approximately 70% of provincial greenhouse gas emissions.

Carbon pricing is gaining momentum globally. In Canada, the federal government is implementing a coordinated nation-wide carbon price, beginning at $10 per tonne of carbon dioxide equivalent emissions in 2018 and rising to $50 per tonne. As of 2017, over 65 jurisdictions, representing about 15% of global GHG emissions, have put a price on carbon.

New Approach to Carbon Pricing

Beginning April 1, 2018, B.C.'s carbon tax rate is $35 per tonne of carbon dioxide equivalent emissions. The tax rate will increase each year by $5 per tonne until it reaches $50 per tonne in 2021.

New revenues generated from increasing the carbon tax will be used to

  • Provide carbon tax relief and protect affordability
  • Maintain industry competitiveness
  • Encourage new green initiatives

To improve affordability, government is increasing the Low Income Climate Action tax credit to $135 per adult and $40 per child for 2018 and continuing the Northern and Rural Homeowner Benefit (up to $200 per household).

Government will consult on a new clean growth incentive program for large industrial emitters in B.C. The program is designed to keep industries competitive as they innovate to cut emissions.

There are two approaches to achieving this goal. The first involves providing incentives for interested B.C. facilities that meet a performance benchmark based on the lowest emitting facility globally the cleanest in the world. The cleanest performers would receive the largest incentives. The second approach involves supporting investment in eligible emissions reduction projects.

New tax revenues will be used to advance important clean initiatives while building our low carbon economy.  

Tax Rates by Fuel

Different fuels generate different amounts of GHG emissions. The April 2018 carbon tax rate of $35 per tonne must be translated based on the type of fuel used. Below are rates for select fuels.

Fuel

Tax Rate Based on $35/Tonne of Emissions

Gasoline

7.78 ¢/litre

Diesel (light fuel oil)

8.95 ¢/litre

Natural gas

6.65 ¢/cubic meter