A new report from the Parliamentary Budget Office (PBO) reveals that the Federal Carbon Tax is costing Canadians more than originally estimated. The independent office of Parliament found that most Canadians are now paying more in carbon tax than they receive in rebates, contradicting earlier claims by the federal government.
The report analyzed both the fiscal and total economic impacts of the tax and highlights a growing burden on households across the country.
In Alberta, the carbon tax is projected to reduce the province’s GDP by 0.6 per cent and lower income by 1.3 per cent. The report also shows that, although lower-income households may see a net benefit by 2030, most Canadians, especially those in middle- and higher-income brackets, will face increased costs. The estimated annual cost of the tax ranges from $130 to over $3,000 for Alberta households.
The findings come as part of a broader assessment of how the tax impacts households when both direct and indirect costs are considered.
The report notes that, by 2030, the combined fiscal and economic impact will result in higher net costs for the average household in all provinces where the federal fuel charge applies. This includes not only Alberta but also provinces such as Ontario and Manitoba.
This is the second time the PBO has issued a report indicating that most Canadians will pay more under the carbon tax scheme, with the first report published in March 2023.