The province of British Columbia has announced an increase in the carbon tax rates, effective July 1, 2011. Carbon tax will rise to a rate equivalent to $25/tonne of CO2 equivalent emissions. This rate increase will convert to 1.11 cents per litre increase of carbon tax on gasoline, for a total of 5.56 cents per litre. Other fuels have similar increases, with an increase of 1.28 cents per litre of diesel fuel to 6.39 cents per litre, and an increase of 0.95 cents per cubic metre for natural gas to a total of 4.75 cents per cubic metre.
British Columbia Finance has also updated bulletin MFT-CT 005, Tax Rates on Fuels, to reflect the carbon tax rates in effect from July 1, 2011 to June 30, 2012.
To help offset the announced increase in carbon tax rates, the province’s Low Income Climate Action Tax Credit will also increase by 10 per cent, effective July 1, 2011. The government of British Columbia provides the Low Income Climate Action Tax Credit to low and modest-income individuals and families on a quarterly basis; the increased annual payments for qualifying British Columbians will be $115.50 per adult and $34.50 per child.
During the first three years since carbon tax has been introduced in the province, tax cuts have returned an estimated $316 million more to taxpayers than the amount of carbon tax that has been paid. Over the next three years, the province’s tax cuts are expected to return $761 million more to taxpayers than the amount of carbon tax that is anticipated to be paid by taxpayers during that period.