Exempt farm inputs; cancel Clean Fuel Standard
Petitioners ask the government to exempt farm inputs from the federal carbon tax and cancel the Clean Fuel Standard. The government responds it removed the federal fuel charge April 1, 2025 and refocused pricing.
Why we would sign this petition
- It would immediately reduce producers’ operating costs; petitioners cite an average Alberta farm facing about $17,000/year in carbon costs, so exemptions could improve farm viability.
- Cancelling the Clean Fuel Standard would, per the petition, avoid projected macroeconomic costs and job losses and protect rural employment and supply chains.
- The petition forces review and transparency on carbon-pricing impacts for agriculture, pressing the government to consider targeted supports or regulatory changes.
Why we wouldn’t sign this petition
- Exempting inputs would weaken carbon-pricing incentives and could shift emissions-reduction costs elsewhere, undermining climate objectives.
- Cancelling the Clean Fuel Standard would forgo investments and new domestic markets for crops (e.g., canola) that the government says create jobs and value for farmers.
- Targeted exemptions or regulatory amendments could better balance competitiveness and climate goals than broad, immediate exemptions or full cancellation.
The summary and both sets of reasons are AI-generated from the petition and given equal weight. Claims are the petitioners’ own; consult the official record for the full text.
Official petition
Petition to the House of Commons We, the undersigned citizens of Canada, draw the attention of the House of Commons to the following: Whereas, the Liberal government's Carbon Tax has placed farmers and ranchers in a carbon tax trap. Our global competitors are not burdened by tens of thousands of dollars of carbon tax debt while Canadian farmers and ranchers do not have the ability to add the carbon tax levy to the price of their product. Instead, they are subject to paying this tax as it is levied by their input suppliers; Whereas, the Liberal government knows what the true cost of this ill-conceived tax will be on Canadian farmers over the coming years since it has undertaken several studies on the impact of the Carbon Tax on farmers, but it has also consistently refused to release their findings to Canadians; Whereas, according to a report from the Parliamentary Budget Officer based on Statistics Canada information, the average farm in Alberta with about 850 seeded acres of crops can expect to see the Liberal government's carbon tax cost it slightly more than $17,000 per year, once the tax reaches $50 per tonne in 2022; Whereas, the Liberal government has now announced that the Carbon Tax will increase to $170 per tonne by 2030 even though the Liberal government denied they would increase it beyond $50 per tonne during the last election; Whereas, the Liberal government is now also in the process of implementing a so-called Clean Fuel Standard initiative that some studies estimate will represent a total cost to the Canadian economy of $7 to $15 billion and 50,000 lost jobs, including an impact of $389 million to the Agricultural sector; Whereas, the high costs of the Clean Fuel Standard is even more questionable given the tax's unachievable emissions reduction goal. Therefore we, the undersigned, call on the House of Commons to take the following actions to address the situation: 1. Immediately exempt all direct and indirect input costs incurred by farmers as a result of the Carbon Tax. 2. Immediately cancel implementation of the Clean Fuel Standard which will have a devastating impact on the Canadian economy, including the agriculture sector.
Government response
Response by the Minister of Agriculture and Agri-Food Signed by The Honourable Heath MacDonald, PC, MP The Minister of Agriculture and Agri-Food understands and acknowledges the concerns of the petitioners. Agriculture and Agri-Food Canada recognizes that taking action to address climate change is critical and urgent, both for our environment and our economy. The Department is actively engaging with partners to ensure that Canadian farmers and ranchers remain competitive and that our water, air, and soil are sustainable for generations to come. The federal government has announced its intention to refocus federal carbon pollution pricing requirements on ensuring carbon pricing systems are in place across Canada on a broad range of greenhouse gas emissions from industry. As part of this announcement, the federal government has removed the requirement for provinces and territories to have a consumer-facing carbon price in place. The federal government has also set federal fuel charge rates to zero as of April 1, 2025, which effectively exempts fuel charges for the agricultural sector from federal pollution pricing. Moving forward, a price on carbon must make sense from an economic and policy perspective, taking into account the need to support Canada’s ambitions within the global economy. This is why the government is considering broader amendments to the Greenhouse Gas Pollution Pricing Act. Also, when the federal fuel charge was in place, gasoline and diesel fuel used in farming machinery was fully exempt from the federal fuel charge. Prior to April 1, 2025, biological emissions from the agriculture sector were not included, and gasoline and diesel used in farming machinery was exempt under the federal industrial pricing system. Agriculture and Agri-Food Canada had previously estimated that approximately 97% of the greenhouse gas emissions generated by farming activities were exempt from, or not subject to, direct federal carbon pollution pricing. The Government of Canada is committed to helping the agriculture sector in mitigating and adapting to climate change to ensure a sustainable and resilient future for Canadian producers. As such, it has invested over $1.5 billion to support farmers in adopting new technologies and farming practices to reduce greenhouse gas emissions and improve on-farm performance. This investment includes funding for the Agricultural Clean Technology Program to support the development of transformative clean technologies and help farmers adopt commercially available clean technology, and for the Agricultural Climate Solutions - On-Farm Climate Action Fund, which targets projects that accelerate emission reductions by improving nitrogen management, increasing adoption of cover cropping, and normalizing rotational grazing. As well, federal, provincial, and territorial cost-shared funding has been allocated under the Sustainable Canadian Agricultural Partnership to help farmers make their farms more resilient and sustainable. The Sustainable Canadian Agricultural Partnership includes programs that help raise producers’ awareness of environmental risks and accelerate the adoption of on-farm technologies and practices to reduce these risks, such as reducing greenhouse gas emissions. As well, Canada’s greenhouse gas Offset Credit System provides opportunities for farmers to benefit from the generation of offset credits through projects that involve the adoption of climate-smart and resilient agricultural practices that are not common practice. The protocol for Reducing Enteric Methane Emissions from Beef Cattle was published in October 2025, and is available for use by a proponent implementing a project to reduce enteric methane emissions in confined beef cattle feeding operations. There are also two other protocols in development for the agriculture sector: Reducing Manure Methane Emissions and Enhanced Soil Organic Carbon. Domestic biofuels can create a valuable, additional market for canola and other agricultural feedstocks, complementing existing export markets while helping mitigate the volatility of global markets. Demand for biofuels like ethanol and biomass-based diesel has grown significantly in recent years, driven by provincial and territorial policies, as well as the Canadian Clean Fuel Regulations. This demand is projected to continue to grow out to 2030. In September 2025, targeted amendments were announced to the Clean Fuel Regulations to support Canada’s low-carbon fuel sector while maintaining the Clean Fuel Regulations’s primary focus on reducing emissions from fuels and transitioning to a lower-carbon economy. These measures will help reduce Canada’s reliance on imported fuels, provide market diversification opportunities for Canadian agriculture, and support Canadian farmers and businesses, whose crops are a key feedstock in the production of Canadian low-carbon intensity fuels. Agriculture and Agri-Food Canada will continue to work with its federal counterparts, including Environment and Climate Change Canada and Finance Canada, to ensure any future decisions on carbon pricing takes into consideration the potential impacts on Canadian agriculture. Response by the Minister of the Environment, Climate Change and Nature Signed by The Honourable Julie Dabrusin The Government of Canada effectively removed the federal consumer-facing carbon price (fuel charge) as of April 1, 2025. As part of this announcement, the federal government also removed the requirement for provinces and territories to have a consumer-facing carbon price in place. The permanent removal from federal law was administered through Part 3 of Bill C-4, the Making Life More Affordable for Canadians Act, and was officialised by receiving Royal Assent on March 12th, 2026. The Government has announced it would refocus federal carbon pollution pricing requirements to cover a broad range of greenhouse gas emissions from industry. Industrial carbon pricing drives multi-billion-dollar investments and is creating tens of thousands of jobs across Canada – and is three times more effective than consumer carbon pricing. In addition, a carbon price on industry does not impact consumers, with research showing that such systems have an impact of approximately zero per cent on household consumption in 2025. The system is designed to create certainty – which creates attractive circumstances for private sector investment. In order to grow a more competitive economy, the federal government has additionally launched Canada’s Greenhouse Gas Offset Credit System (Offset System), which provides a financial incentive to undertake voluntary innovative projects that reduce greenhouse gas compared to business-as-usual practices. Agriculture is a key sector that benefits under the Offset System, as it enables farmers to generate credits from greenhouse gas reduction and removals projects. The first federal offset protocol in the agriculture sector was published in 2025 – Reducing Enteric Methane Emissions from Beef Cattle – which focuses on reducing enteric methane emissions in confined beef cattle feeding operations. Two other protocols in the agriculture sector are under development: Reducing Manure Methane Emissions and Enhanced Soil Organic Carbon. Federal offset credits can be sold and used by facilities covered under the federal Output Based Pricing System regulations or to other companies to use towards their net-zero targets. The Clean Fuel Regulations protect the environment and human health by significantly reducing greenhouse gas emissions. As announced on September 5, 2025, and reiterated in Budget 2025, the Government of Canada is making targeted amendments to the Clean Fuel Regulations to support Canada’s domestic low carbon fuel sector while maintaining the Regulations’ primary focus on lowering emissions and transitioning to a low carbon economy. The Clean Fuel Regulations, which came into force in 2022, requires gasoline and diesel primary suppliers (for example, producers and importers) to reduce the carbon intensity of the gasoline and diesel they produce and import into Canada by 15% in 2030 below 2016 levels. Fuel prices are shaped by many global factors, from supply chains to international markets. The Clean Fuel Regulations do not set or impose a price increase at the gas pump. In fact, as stated by the Advanced Biofuels Canada Association, the Clean Fuel Regulations will add $1.09 in value per bushel – creating or preserving average farm value by $60,000. The Clean Fuel Regulations has supported billions of dollars of investments in clean fuels projects in Canada. Key projects include Imperial Oil’s renewable diesel facility in Strathcona, Alberta, which started production in summer 2025 ($720 million) as well as Co-processing projects at six refineries across Canada, allowing renewable feedstocks to be refined along with crude oil. By creating more demand for Canadian low carbon fuels, the targeted amendments will maintain the regulations’ primary focus on reducing emissions from fuels and transitioning to a low carbon economy while supporting Canada’s agriculture producers – such as canola – whose crops are a key feedstock in the production of domestic low carbon fuels. Under the Clean Fuel Regulations, 90% of biomass-based diesel produced in Canada is made from Canadian canola. Feedstock providers for low carbon fuel, such as canola farmers and canola crushers, see greater value for their products, as additional demand is created by the Clean Fuel Regulations. A third-party analysis estimated that, on average, annual direct economic impact from the domestic canola-based low carbon fuel chains on the Canadian economy has been $703 million from 2021-2023, including $589 million from farming. With indirect impacts, this number rises to $1.8 Billion. For example, the direct economic impact of Imperial’s renewable diesel Strathcona plant is enormous, starting with the 40,000 growers who will benefit from having a new market for 2.5 million tonnes of their canola. Incentivized by this large facility, an additional $1 million to $1.5 million in capital has been invested in two to three new crush plants to supply the facility with processed canola oil. The demand for canola from Imperial’s Strathcona plant at full capacity is equal to 50% of the canola produced in Alberta (about 10% of all Canadian canola). The Clean Fuel Regulations remain an important tool to drive investments in clean technology, low carbon fuels and innovation across Canada. Response by the Minister of Finance and National Revenue Signed by The Honourable François-Philippe Champagne On March 14, 2025, the Government of Canada announced that the federal fuel charge will cease to apply, effective April 1, 2025, and removed requirements for provinces and territories to have a consumer-facing carbon price in place as of that date. The government has legislated the permanent, sequential repeal of Part 1 of the Greenhouse Gas Pollution Pricing Act and Fuel Charge Regulations. With the removal of the federal fuel charge, the Government of Canada provided a final quarterly Canada Carbon Rebate payment starting in April 2025 to eligible households. Direct fuel charge proceeds return mechanisms for Canadians, small and medium-sized businesses, farmers, and Indigenous governments are also being wound down. The Government of Canada values the importance of Canada’s agriculture and agri-food supply chains, and recognizes the vital importance of a resilient agriculture and agri-food sector that is able to grow sustainably. To this end, the Government of Canada is always working hard with stakeholders, representatives of various sectors, and provinces to find real, practical solutions for farmers, as needed.