The government of the Northwest Territories in Canada has decided to introduce a carbon tax on the sale of fossil fuels as of 1 July 2019. The tax rate will be set at C$20/tCO2eq (US$15/CO2eq) and will be progressively increased to C$50/tCO2eq (US$38/CO2eq) by 2022.
Since transportation accounts for nearly 60% of fossil fuel consumption in the Northwest Territories, the tax is expected to significantly increase shipping costs and end-consumer prices.
Most households, businesses and government agencies will be fully exempted from paying the carbon tax for heating fuel, and the aviation sector will be exempted as well. Families will be offered a new tax benefit ("Cost of Living Offset") of C$260/year per adult and C$300/year per child, to be received as tax return; its amount will progressively raised over years. Large greenhouse gas emitters such as diamond mines and oil facilities will have an annual rebate for 75% of their carbon tax collected on heating fuel and "non-motive" diesel. The remaining 25% will be held in trust accounts for investments to reduce emissions.
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