Alta. fuel taxes – what you need to know

Nov 14, 2018

Producers who dry grain this fall should check their propane bills for provincial tax

By Kate Ayers
Staff Writer
Farms.com

Western Canadian grain farmers had to dry most of their crops this year, which led to increased costs and producer uncertainty about fuel taxes and rebates in Alberta.

In some cases, the system is straightforward; many producers are well acquainted with the taxes and exemptions on farm gas and diesel.

“The Alberta Farm Fuel Benefit Program allows eligible producers to receive a 9 cent per litre provincial tax exemption on the purchase of marked gasoline and diesel used for farming purposes,” Neil Blue, a provincial analyst with Alberta Agriculture and Forestry, said in a recent ministry article.

“Eligible producers are also exempt from the provincial carbon levy on those fuels. To qualify for these benefits, producers must be actively and directly farming, be making the day-to-day management decisions, and have an annual farm commodity production worth at least $10,000.”

Farmers who receive payments from the Canada Pension Plan, Old Age Security or supplements are eligible for tax exemptions if the farm’s gross annual revenue is $5,000 to $9,999, the article said.

“Upon application approval, an exemption certificate and number are issued,” Blue said.

“Exempt producers then provide that number to their fuel distributor who excludes the provincial 9 cent per litre fuel tax and carbon levy from the purchase of marked diesel and gasoline.”

The GST registrants can also receive a rebate for the GST that the feds charge on fuel purchases.

The rules surrounding propane are less clear.

Only propane used to fuel motor vehicles, also known as a motive fuel, has a 9.4 cent per litre provincial tax in Alberta.

“However, it is possible that some propane suppliers may be charging this 9.4 cent per litre provincial tax on all propane sold,” Blue said.

“So, purchasers of non-motive use propane should check with their supplier to determine if the purchase contains that provincial tax.

“If (your bill) does contain that 9.4 cent tax, tax rebate forms are available from Alberta Finance for propane used for farming, heating, lighting and appliances.”

Suppliers charge a 4.64 cent per litre carbon levy plus GST on all propane. Producers using propane for their businesses can use the carbon levy as a farm expense. Likewise, GST registrants can apply for a refund for GST on propane used for the business, the article said.

The Remote Area Heating Allowance Program can help producers who lack access to natural gas. The program provides a rebate of up to 25 per cent for heating costs.

More information on fuel taxes and rebate programs in Alberta is available here.

Video: Will the 2025 USDA December Crop Report Be a Market Mover/Surprise?

Historically, the USDA December crop report is a non-event or another dud report as the USDA reserves any final supply changes to the final report in January of the following year in this case 2026. But after the longest U.S. government shutdown in history at 43 days and no October crop report will they provide more data/surprise and make an exception?
Our China U.S. soybean purchase tracker is now at 26.6% or a total of 3.2 mmt but for traders it’s taking too long to unfold.
The final Stats Canada production report was bearish canola and wheat projection a record crop in both (it adds to the global glut of supplies) and bullish local corn and soybean prices in Ontario/Quebec thanks to a drought. It will not help the fund flow short-term, the USDA may need to offset it?
A U.S. Fed interest rate cut of another 25-basis point next Wednesday (probability 87.1%) could help fund flow and sentiment in stock and ag commodities into year end.
More inflows into Bitcoin this past week saw prices rebound back above 90,000 with support at 82,000 and resistance at 96,000.
A V-shaped bottom in cattle suggest the lows are in after Mexico reported another new world screwworm case. Lower weights, seasonal demand and higher U.S. beef select/choice values with a continued closure of the Mexican border to cattle will result in a resumption of higher cattle futures into yearend.
Australia is expected to produce its 3rd largest wheat crop ever at 36 mmt adding to the global glut of supplies.
Reports of ASF in hogs in Spain the largest pork exporter in Europe could see the U.S. win more pork export business long-term.
If the rains verify into next week of 3-5 inches for Brazil it would go a long way to fixing the dry regions from the last 2-months, but the European weather model has been wrong for the past 2-months!
Natural gas futures are surging to the 3rd price count as frigid hold temps set in.
CDN $ is also surging to end the week on a very resilient economy and better employment numbers suggesting no interest rate cuts next week.
Finally, the CFTC report showed funds were net buyers of soybeans but sellers of corn, canola and wheat. In real time the funds have gone back to selling as they take some profits.