fb Federal Carbon Tax - Dowler-Karn

The Federal Government, through its Greenhouse Gas Pollution Pricing Act, charges a carbon tax on all fuel consumed in the Province of Ontario.

Specifically, the Federal Carbon Tax is charged on all propane, gasoline, diesel and kerosene products sold by Dowler-Karn.

Find The Federal Carbon Forms Here

The current status is as follows:


10.06 cents per litre, as of April 1, 2023 (compared to 7.74 cents per litre the previous year).


14.31 cents per litre, as of April 1, 2023 (compared to 11.05 cents per litre the previous year).


17.38 cents per litre, as of April 1, 2023 (compared to 13.41 cents per litre the previous year).


16.78 cents per litre, as of April 1, 2023 (compared to 12.91 cents per litre the previous year).

These amounts will be indicated on your invoice as a separate line item, to indicate a tax, and are not included in the price you pay for your products. It is the legal responsibility of Dowler-Karn to both charge & remit the tax to the Federal Government.

What Is Exempt from The Federal Carbon Tax?

Relief for Farmers

Under certain defined conditions, exemptions are available through the use of an exemption certificate. They are limited to:

  • The operation of farm machinery for the purpose of farming (tractors, combines, etc.).
  • Farm machinery also includes small & portable engines used in farming activities (chain saws, generators, etc).

“Specifically, the GGPPA provides that a registered distributor can generally deliver, without the fuel charge applied, gasoline or light fuel oil (e.g., diesel) to a farmer at a farm, if the fuel is for use exclusively in the operation of eligible farming machinery and all or substantially all of the fuel is for use in the course of eligible farming activities.”*

*  More Info

Commercial Greenhouse Operations

For the exclusive purpose of heating a greenhouse or generating carbon dioxide (CO2). These greenhouse purposes are 80% exempt.

“Partial relief of the fuel charge (i.e., 80 per cent) is proposed to apply to propane that is exclusively for use in the operation of a commercial greenhouse for growing any plants, including vegetables, fruits, bedding plants, cut flowers, ornamental plants, tree seedlings and medicinal plants. It is also proposed that, in order for relief to be available, all or substantially all of the greenhouse building must be used for the growing of plants.”*

“The relief is proposed to be provided upfront through the use of exemption certificates, similar to other exemption certificates under the GGPPA, such that only 20 per cent of the fuel charge applies to propane that is delivered by a registered distributor to an eligible greenhouse operator if the fuel is exclusively for use in the heating of, or for the production of carbon dioxide for use in the operation of, a commercial greenhouse.”*

An eligible greenhouse operator is proposed to be a person that carries on a greenhouse operation with a reasonable expectation of profit.

*  More Info

What is not exempt from The Federal Carbon Tax

It is our understanding that any kind of heating application not specified above is not exempt, as follows:

  • Barn heating for any purpose;
  • Crop drying;
  • Residential heating;
  • Fuel that is used in licensed vehicles


What do I need to become exempt from The Federal Carbon Tax?

Eligible farmers must complete form L402, which is available at the following link:

Download Form L402

Eligible greenhouse operators must complete form L404, which is available at the following link:

Download Form L404

If you would like us to send you these forms, or if you have any questions/difficulty downloading them, get in touch and we would be happy to help you.

Please note we cannot provide fuel exempt from the Federal Carbon Tax, unless we have a completed copy of the required form on file.

As noted on each exemption form, the original certificate is to be provided to your supplier. Keep a copy of the certificate with your records and do not send the certificate to the Canada Revenue Agency.

Please make sure you have your completed forms returned to us in a timely manner, as we can not retroactively make adjustments!

We also encourage you to continue to monitor our webpage for further information. If we receive additional information or clarity from our industry and government contacts we will promptly update the website with new and relevant information.

We also encourage our customers to review the regulation and to understand the expectations and penalties for making a false declaration. If you have questions, please let our customer account representatives assist.

Please also note:
The Government of Canada has introduced the new climate action incentive payment. If you are a resident of Ontario, you can claim it when you file your income tax and benefit return. We share this for your information only as it has no connection to our service to you. You can find out more at Canada.ca/climate-action-incentive.