The government pledged to return 10 per cent of carbon tax revenue to small businesses, farmers and Indigenous people but thus far almost nothing has been refunded,” said CFIB President Dan Kelly. That’s particularly concerning with the tax due to increase to $80 per tonne on April 1.

“There is no mechanism in place to return a dime to small businesses paying the federal carbon tax in eight provinces,” Kelly said. “No wonder some Indigenous organizations are taking the federal government to court.”

Also, CFIB estimates small businesses actually pay 40 per cent of the costs of the carbon tax, “yet they are only supposed to receive up to 10 per cent of the revenue once Ottawa gets around to figuring out a way to return the dollars as promised.

“While the federal government charges carbon taxes to all small businesses, they plan to rebate only a select few in emissions-intensive and trade-exposed sectors, whatever that means,”

CFIB is very concerned that Ottawa may have already decided to lower the allocation for small businesses to pay for the changes made last fall to double the rural consumer rebates. “Canada’s carbon tax system is a mess and is deeply unfair to Canada's small businesses who are the second largest payer of the levy after consumers,” Kelly said. “It's not surprising that a strong majority of small firms are now opposed to the federal carbon tax regime.”

In response to the CFIB comments, Environment Canada said there are a range of supports in place to help SMEs in Canada and the small business tax rate was cut to 9 per cent from 10.5 per cent, the lowest rate for SMEs in the G7.

The government is preparing to return over $2.5 billion of fuel charge proceeds collected since 2019 to emissions-intensive and trade-exposed small and medium-sized enterprises in Ontario and the Prairies.

The first phase of these return programs will distribute approximately $2.5 billion of fuel charge proceeds to emission-intensive and trade-exposed small- and medium-sized businesses in Ontario and the Prairies covering from 2019 to 2024.

CFIB wants the money refunded immediately to Ontario and Prairie businesses followed by the implementation of a simple rebate formula to return 10 per cent of ongoing carbon tax revenue to small businesses across all eight provinces on a quarterly basis, with a plan to raise it to 40 per cent.

Also, the carbon tax should be frozen at its current level and exempt all heating fuels, including natural gas.

“With the new year bringing new costs, we're calling on Ottawa to take some concrete action and do more to help small businesses facing financial hardships. CFIB has launched a petition to ensure the voice of Canada's small businesses is heard in Ottawa. Small businesses can sign CFIB's petition calling for carbon tax fairness.”

This news report was prepared for National Newswatch.