Prep Your Business for Carbon Tax



In Canada, the federal government announced the implementation of a country-wide carbon pricing plan as part of Finance Minister Bill Morneau’s small business tax changes last year.  If you live in Ontario, New Brunswick, Manitoba or Saskatchewan, you’re about to be impacted by the federally imposed carbon tax coming into effect in 2019.  Being dubbed as the “price of pollution”, the carbon tax is intended to minimize fossil fuel emissions created by both large-and-small-scale businesses and will begin at $20 per tonne in January 2019 and rise by $10 per year until it’s estimated to hit $50 per tonne of C02.


Like most Canadians, small businesses owners care about the environment so many are actively looking for ways to introduce eco-friendly business practices and greener technologies to run their business.  The government has confirmed it “recognizes that SMEs can expect to incur additional costs as a result of carbon pollution pricing.” As a result reimbursements will be made for small-and medium-sized companies, but the government did not specify the criteria that would be used. Further government statements have proposed additional details will be released in early 2019.


Current estimates suggest the overall value of reimbursements for SMEs will total $105 million in Ontario in 2019-20, as well as $30 million in Saskatchewan, $15 million in Manitoba and $5 million in New Brunswick. In recent headlines, it’s been stated that the federal government expects to spend nearly $1.5 billion helping small and medium-sized businesses adapt to carbon pricing over the next five years — but it will not exempt them from the new carbon tax regime.  The tax changes will affect everyone from small textile manufacturers to pizza restaurants that use natural gas-fired ovens, dry cleaners that use heated or gas-run appliances and trucking companies that use large amounts of fuel and oil for their vehicles.


Large scale emitters like cement makers, oil and gas companies and mining firms have been largely supportive of carbon taxes, arguing it’s the most efficient mechanism to drive down emissions. Released in an article by the Saskatoon Star Phoenix, Environment Minister Catherine McKenna says, the government is no longer allowing anyone in Canada to pollute for free but that there will be support to help small businesses adapt by making their operations more energy efficient.  Some of the ways SMEs can prepare to reduce their carbon footprint and combat carbon tax include:

• introducing and expanding recycling systems;
• reducing their electricity usage;
• sourcing more environmentally friendly products;
• applying for government rebates;
• leverage building technologies and;
• other products to increase energy efficiency on a larger scale.

It’s being estimated about $2.3 billion will be raised from the tax in the next two years or so, of which, 90 per cent will be rebated to households through income tax returns. The other 10 per cent will be funnelled into the SME program to help smaller businesses and other organizations which can’t pass the tax on through increase of prices.

While the carbon tax will definitely leave an impact on businesses small and large, adopting greener work ethics, and introducing some of these green initiatives into the culture of your business will go a long way in ensuring your carbon footprint is reduced for the greater good of all. Visit our blog for more insights.

An Important Update About Bullfrog Insurance

Please be aware that due to a change in our operations, Bullfrog Insurance has made the difficult decision to start winding down our business. This means we are no longer accepting new clients.

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