— Photo Kateryna Babaieva, Pexels
The carbon tax you paid at the pump ended in April 2025. The one that didn’t end is the one nobody sends you a bill for.
It’s called the industrial carbon tax, and it’s charged to large facilities like the steel mills, cement plants, fertilizer producers and oilsands operations that supply the things Canadian households buy.
Here’s how it works: Each facility is given an emissions limit and pays the tax on every tonne it emits above that limit. A facility that comes in under its limit earns credits it can sell to another company. The federal government says the system is meant to reduce emissions while keeping costs low enough that production doesn’t move offshore. However, most of the world doesn’t charge this tax, and the World Bank reports that just over 29 per cent of global emissions are covered by a carbon price of any kind.
You won’t find the industrial carbon tax on any receipt you get, but it sits inside the cost of making things in this country, and it weighs on the decisions companies make about where to build and who to hire.
The financial burden of this tax is back in the spotlight as American tariffs have made that cost much harder for Canadian producers to carry. Steel and aluminum now pay U.S. duties to sell into their largest market and the carbon tax to produce at home, which means two charges on the same product that ultimately consumers pay for.
That’s why calls to scrap it have come back. The argument is that a sector already absorbing a foreign tariff shouldn’t be carrying a domestic charge on top of it, and that removing the tax is one of the few things Canada controls while the trade dispute plays out.
At home, engaged women have expressed little support for the industrial carbon tax. Our 2026 national research tested five federal energy policies and this one came last, with only 38 per cent support. This points to a disconnect between current policy and what women believe will strengthen Canada’s economic position, reduce emissions and improve affordability at the household level.