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Sask. residents will not receive carbon rebates after province refuses to remit, federal minister says

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The Government of Canada says Saskatchewan residents will not receive carbon rebate cheques – after the provincial government announced it will stop remitting the carbon levy on natural gas for home heating.

Federal Natural Resources Minister Jonathan Wilkison said Thursday that Saskatchewan’s decision hurts lower-income families in the province – who would receive more in rebates if the levies continued to be paid.

"They will no longer get the rebate," he told The Canadian Press. "The rebate actually provides more money for most families in Saskatchewan."

In a statement posted to X, Premier Scott Moe said the decision to eliminate rebate cheques was unfair to Saskatchewan families, adding that residents in the province are still paying the federal carbon tax on things like gasoline, diesel and propane.

Moe threatened that if Ottawa follows through with ending rebate cheques for Saskatchewan people, the province might stop remitting the carbon tax entirely.

“But if Saskatchewan people stop getting the rebate entirely, Saskatchewan should stop paying the carbon tax entirely."

Thursday's sequence of events began with Saskatchewan’s Minister of Crown Corporations, Dustin Duncan, announcing the province would not remit the carbon tax in a video message posted to X.

“Today, I’m announcing that in addition to not collecting the carbon tax on SaskEnergy bills, the Government of Saskatchewan will not be remitting the federal carbon tax on natural gas that Saskatchewan families use to heat their homes,” Duncan stated, while standing in front of Parliament Hill.

“This is a decision that we do not take lightly and we recognize that it may come with consequences.”

The minister went on to criticize the federal government’s environmental policies, its decision to exempt home heating oil from the levy and defended the province’s decision to oppose the policy.

Saskatchewan officially stopped collecting the carbon levy on Jan. 1, 2024.

The deadline to remit, or send the collected tax, to the Canada Revenue Agency (CRA) for the month of January is Feb. 29.

On Feb. 21, the government confirmed it is now recognized as the individual supplier of natural gas by the CRA.

The change in designation is meant to protect SaskEnergy employees from any repercussions from the decision to withhold the funds.

Duncan has previously commented on the prospect of hefty fines and even possible jail time for failing to remit the carbon tax.

“I guess if it comes to that point where somebody's going to carbon jail, that likely will be me," he told reporters when asked back in November.

Wilkinson described Saskatchewan’s move as reckless – seeing as the federal legislation was upheld by the Supreme Court of Canada.

"[It's] irresponsible and almost unheard of in the history of this country," he said. "Premiers, just like prime ministers, are responsible for passing laws and they expect their citizens to abide by those laws. If you do not have that expectation, you have anarchy."

Justice Minister Arif Virani says the federal government will deal with Saskatchewan’s noncompliance with the law “accordingly” once concrete steps are taken.

"I'm not going to engage in hypotheticals about what [Saskatchewan] may or may not do in the future,” he told The Canadian Press. “When they actually take a step like that, we will deal with it accordingly.”

On Nov. 30, Moe announced Saskatchewan would also not remit the carbon levy on electric home heating.

In his video message on Thursday, Duncan only mentioned the province’s refusal to pay the levy on natural gas used for home heating.

Duncan also claimed the non-remittance has led to $400 in savings for families so far in 2024. The province has also claimed its non-compliance with the carbon levy led to lowered inflation in Saskatchewan – an assertion that’s been questioned by economists.

While highlighting affordability, Duncan stressed the government’s stance that the home heating oil exemption is allowing the federal government to treat Saskatchewan residents as “second class citizens.”

“The carbon tax has always been unaffordable but up until now at least it had been applied fairly. The heating oil exemption for Atlantic Canada changed that,” he said.

“Our government simply is not going to accept this unfair treatment of Saskatchewan families.”

--With files from The Canadian Press.

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