—but these are detailed rules.
In the case of a farmer, a registered distributor—the person who would normally pay the fuel charge—can deliver gasoline or light fuel oil. In the case of farmers, that is essentially diesel. They can deliver that to a farmer if the farmer certifies four things. It's basically an exemption certificate. If an exemption certificate is presented—whose conditions I'm going to describe—the fuel distributor doesn't have to pay the fuel charge on the fuel that is delivered to the farmer. Therefore, the carbon priced is not built into the selling price of the fuel.
The farmer needs to certify that essentially he's a farmer, that the fuel is being delivered at a location that is a farm, that the fuel is exclusively for use in the operation of eligible farm equipment, and that substantially all of the fuel is for use in eligible farming activities. As I said, if these conditions are met, the fuel distributor will be allowed to deliver the fuel without the fuel charge applying.
The concepts of farmer, eligible farm equipment, and eligible farming activity are defined terms within the legislation:
farmer means a person that carries on a farming business with a reasonable expectation of profit.
eligible farming machinery means property that is primarily used for the purposes of farming and that is
(a) a farm truck or a tractor;
(b) a vehicle not licensed to be operated on a public road;
(c) an industrial machine or a stationary or portable engine; or
(d) prescribed property; but does not include
(e) a vehicle that is an automobile as defined in subsection 248(1) of the Income Tax Act;
(f) property that is used for the purpose of providing heating or cooling to a building or similar structure; or 20
(g) prescribed property.
eligible farming activity means
a) the operation of eligible farming machinery on a farm for the purposes of farming;
(b) the operation of eligible farming machinery for the purposes of going from a location at a farm to another location at a farm; or
(c) a prescribed activity.
This is essentially how the exemption certificate works for farmers. I'm also going to add more information here.
Under this legislation the general rule is that if you're entitled to use a exemption certificate, you have to register with the CRA and produce monthly returns. In the case of farmers, that requirement has been removed. They do not have to register with the CRA.