Mr. Speaker, the purpose of the Greenhouse Gas Pollution Pricing Act, GGPPA, is to reduce greenhouse gas emissions by ensuring that pollution pricing applies broadly throughout Canada. In those jurisdictions that do not meet the federal benchmark, that is, Ontario, Manitoba, Saskatchewan, and Alberta, the bulk of the proceeds from pollution pricing are returned directly to individuals and families through climate action incentive payments, which help offset the additional cost associated with pollution pricing.
In 2023-24, the federal fuel charge will continue to apply in these provinces and will come into effect as of July 1, 2023, in Newfoundland and Labrador, Prince Edward Island and Nova Scotia, where 90% of direct proceeds will be returned to residents through climate action incentive payments. Starting in July 2023, a family of four will receive $328 in Newfoundland and Labrador, $240 in Prince Edward Island and $248 in Nova Scotia each quarter. Starting in April 2023, such a family will receive $244 in Ontario, $264 in Manitoba, $340 in Saskatchewan and $386 in Alberta on a quarterly basis. Families in rural and small communities are eligible to receive an extra 10%. Some eight out of 10 families receiving climate action incentive payments get more money back than they pay in direct costs under this system, with families that earn less benefitting the most, on average.
Canada and the rest of the world has also been experiencing a period of higher inflation, including for food and groceries. This is part of a global phenomenon, driven by the impacts of Russia’s invasion of Ukraine, which have led to sharply higher food and energy prices, as well as persistent impacts from supply chain disruptions and the COVID pandemic.
With respect to the goods and services tax/harmonized sales tax, or GST/HST, the GST/HST is a broad-based tax that is calculated on the final amount charged for a good or service. The general rule that was adopted at the inception of the GST and carried over for the HST is that this final amount includes other taxes, levies and charges that apply to the good or service and are generally embedded in the final price. This long-standing approach to calculating the GST/HST helps to maintain the broad-based nature of the tax and ensures that tax is applied evenly across goods and services consumed in Canada. It also makes it easier for vendors to calculate the amount of tax payable, for consumers to understand and for the Canada Revenue Agency to administer.
To support those most affected by the high-inflation environment, starting November 4, 2022, an estimated 11 million low- and modest-income people and families will receive an additional goods and services tax credit payment, equivalent to doubling the credit for six months. Single Canadians without children will receive up to an extra $234, and couples with two children will receive up to an extra $467. Seniors will receive an extra $225 on average.