Carbon Tax - Part Two

As a farm operator, there are significant implications of any carbon tax, however the province of Manitoba has acknowledged these potential impacts by including an exemption from the carbon levy for marked diesel and gasoline.  Although this does address one aspect of farm operator’s concerns, it may not address indirect impacts.  For instance, there may be the potential for indirect costs to be passed on to farmers, which has the potential to influence competitiveness with other jurisdictions, both nationally and internationally.

Large industrial emitters, like fertilizer plants, will be included in the plan through an output-based pricing system where they will only have to pay the $25/tonne levy when emissions exceed a pre-determined target.  These industrial emitters can earn credits allocated for future use when their emissions are below the target.  At this point, the process of determining targets is not defined.  This means that industry and agricultural sectors do not yet have a clear idea of any potential impacts concerning this aspect of farming operations.

The Manitoba plan does provide more local input into how revenues, estimated to be $260 million annually, are spent.  Some suggested options include:

  • Creation of an ecological goods and services program

  • Program to fund the adoption of beneficial management practices (BMPs)

  • Creation of a Center for Sustainable agriculture to research ways to reduce on-farm emissions

  • Expand the adoption of precision farming technologies that improve fertilizer use efficiency

  • Support research for the use of natural fibres in composites

  • Evaluating and developing strategies to respond to risk and opportunities facing farms due to weather changes and extreme weather events

There are a lot of options in how a carbon tax is applied, they key for you as our readers is understanding the implications to farm operations.  With both the federal and provincial plans, as with all tax code changes, there are pros and cons.  We encourage you to get involved as Manitoba looks to determine:

We would love to hear your comments – use the box below or email us directly at or