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Interjurisdictional road carriers – Registration under the Greenhouse Gas Pollution Pricing Act


On April 1, 2019, the Greenhouse Gas Pollution Pricing Act (the “Act”) came into force in Manitoba, New Brunswick, Ontario and Saskatchewan, and it will come into force on July 1, 2019 for each of Nunavut and the Yukon (the “Listed Provinces”). The Act does not apply to the other provinces, which have implemented other carbon pricing mechanisms acceptable to the Federal government. In those provinces, road carriers are not required to register or file returns.

The fuel charge applies to 21 types of fuel that will be delivered, transferred, used, produced, imported or brought into one of the Listed Provinces. In general, the fuel charge rates reflect a carbon pollution pricing of $20 per tonne of CO2 equivalent by 2019, rising by $10 per tonne annually. The exact rate will vary depending on the Listed Province and type of fuel.

The Act applies to persons including fuel producers, fuel wholesalers, emitters and fuel distributors, and air, marine, rail and road carriers. Specifically, any road carrier with interjurisdictional business activities is required to register for any gasoline, light fuel oil, marketable natural gas, or propane if the person uses fuel of that type in a specified commercial vehicle in respect of the Listed Provinces. A specified commercial vehicle is defined as one:

(a)  that is used to provide commercial transportation of individuals or goods by road

(i)  from one province to another province, or
(ii) from a particular location to another location if one location is in Canada and one location is outside Canada;

(b)(i)  that has two axles and a gross vehicle weight exceeding 11,797 kg,

(ii)  has three or more axles regardless of weight, or
(iii) when combined with the trailer with which it is used, has a gross vehicle weight exceeding 11,797 kg; and

(c)  that is not a recreational vehicle, including a motor home, bus or pickup truck with attached camper, if used solely for a particular individual’s personal use or enjoyment or the personal use or enjoyment of any other individual at the particular individual’s expense.

The Canada Revenue Agency (the “CRA”) is responsible for administering and enforcing the fuel charge component of the Act. Persons required to register under the Act should have applied for registration prior to April 1, 2019, if carrying on interjurisdictional activities in either Manitoba, Saskatchewan, Ontario or New Brunswick. For Nunavut and the Yukon, registration is required by July 1, 2019. Failure to register before the appropriate deadline will result in a $2,000 fine. Once registered, road carriers are required to report to CRA on a quarterly basis, similar to the requirements under the International Fuel Tax Agreement. This will include the amount of fuel used and the kilometres travelled in each of the Listed Provinces.

There are two exceptions to the requirement for interjurisdictional road carriers to be registered with CRA. First, a road carrier would not be required to register if that person is registered for the same type of fuel as a distributor, a specified air carrier, an air carrier, a specified marine carrier, a marine carrier, a specified rail carrier, or a rail carrier. Secondly, a road carrier would not be required to register with CRA if its business activities are confined within the boundaries of only one of the Listed Provinces.

The Ontario and Saskatchewan governments have each brought a legal challenge against the Federal government on the basis that the Act is ultra vires of its powers. The Saskatchewan challenge is currently before the Saskatchewan Court of Appeal.

By Jane Loyer, Miller Thomson

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