In the fall of 2021, the federal government proposed a rebate for farmers to offset the costs of the carbon tax. This proposal was contained in Bill C-8, ‘An Act to implement certain provisions of the economic and fiscal update.’

In December 2021, Bill C-8 had its first reading in the House. Although the Bill had not yet been enacted, farmers were able to claim the carbon tax rebate on their 2021 tax returns. It was later announced that the legislative process to pass Bill C-8 had been delayed.

The Canada Revenue Agency (CRA) later announced that they would be withholding tax returns for any farmer who claimed the rebate since the Bill had not officially been passed. Therefore, all tax returns filed with the Carbon Rebate were put on hold, indefinitely.

On April 25, OFA wrote a letter to the Deputy Prime Minister/Minister of Finance, Honourable Chrystia Freeland, urging an immediate passing of the Bill or instructions to CRA to release the tax returns of farmers impacted by this.

Ontario farmers received a win on this issue when Bill C-8 received Royal Assent on June 9, 2022. Farmers are encouraged to get in touch with the CRA to discuss when their tax returns will be fully processed and issued. The CRA should be equipped to continue processing the returns for those farmers held up by the tax credit issue.

We will continue to update our members on the status of Bill C-8 and the hold on tax refunds as we receive further information.