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KAP welcomes further carbon tax exemptions

Fuels used to heat and cool livestock buildings, greenhouses or to dry or store crops will be exempt

KAP president Dan Mazier is pleased fuels used to heat and cool livestock buildings, greenhouses and dry grain are exempt from the province’s $25 a tonne carbon tax.

The Manitoba government’s carbon tax exemption on marked farm fuels used in farm equipment and trucks, has been extended to include heating and cooling farm buildings and drying crops.

“A farm building for fuel and carbon tax purposes is a building where you either keep or raise livestock for sale or a building where you grow a crop or store your crop that’s grown for sale,” a Manitoba government document obtained by the Manitoba Co-operator says. “Fuel to heat or cool a livestock building and a greenhouse would be tax exempt for both the fuel and carbon tax. This would apply to heating oil as well. “

Agriculture Minister Ralph Eichler confirmed the government’s decision in an interview March 23.

“When it comes to farm products we know that’s the economic engine of our province as well,” Eichler said. “We know we made the right decision on this issue.”

Agriculture Minister Ralph Eichler says it was the right decision to exempt fuels used to heat and cool livestock buildings, greenhouses and dry grain from the province’s $25 a tonne carbon tax. photo: Allan Dawson

Eichler stressed the exemption will not include farm homes and farm buildings and grain dryers will need to have their own metres to qualify.

Both Eichler and Premier Brian Pallister have repeatedly said Manitoba’s $25 a tonne carbon tax, which takes effect in September and adds an extra 5.32 cents a litre gasoline, 6.71 cents on diesel, 3.87 cents on propane and 4.74 cents per cubic metre on natural gas, should not hurt the province’s farmers, most of whom rely on export markets and can’t pass the tax cost on.

“It’s very good news,” Keystone Agricultural Producers president Dan Mazier said in an interview March 23. “We need a Manitoba approach. The system worked. We brought it to government’s attention… and there it is, they listened. Good on them for listening. It’s good for agriculture to make it grow and be competitive going forward.”

Farmers won’t be completely exempt for the carbon tax as it will be included in the cost of many goods and service they buy for their operations, Mazier said.

Manitoba Pork Council general manager Andrew Dixon also welcomed the exemption. Sow and weanling pig barns require more heat during cold temperatures than feeder pigs as they generate a lot of their own heat, he said in an interview March 23.

“It (carbon tax) would be just another cost to bear that competitors (in the United States) don’t,” he said. “And our (hog) prices are based on a U.S. price formula.”

The carbon tax exemption will also apply to the following:

  • Commercial fishing when operating a boat or a tractor, snowmobile or similar vehicle during an open commercial fishing season.
  • Commercial trapping when operating a boat or snowmobile during an open trapping season.
  • Shipping when operating a boat for shipping cargo as part of the shipping business.
  • Prospecting when operating a boat and holding a valid prospector’s licence.
  • Mining when used for drying mineral ore concentrates, heating replacement air in an underground mine or operating an engine exclusively off-road and transporting ore exclusively off-road from a mine in Manitoba to a processing centre in Manitoba.
  • Commercial logging when operating an engine (not a vehicle), in the course of harvesting, handling or processing forest products, operating a motor vehicle for the off-road transportation of forest products, operating an engine in the construction or maintenance of a logging road or an engine off-road for forest renewal activities.
  • Hospitals – when used in operating machinery
  • Municipalities – when operating firefighting equipment, lighting plant or its own equipment (not a vehicle) for constructing or maintaining municipal works.

Pallister announced the carbon tax exemption for marked farm fuel when he unveiled his “Made-in-Manitoba Climate and Green Plan” at Oak Hammock Marsh Oct. 27, 2017.

“We all know the farm sector is critical to the province,” Premier Brian Pallister said.

Agriculture produces 32 per cent of Manitoba’s carbon, second only to transportation.

“While agriculture is a significant source of greenhouse gas emissions, agricultural soils and biomass can also serve as effective carbon sinks, helping to lock harmful carbon emissions in the ground and prevent carbon dioxide from entering the atmosphere,” the plan says.

Pallister and Eichler have also said farmers will play a big role in helping Manitoba reduce greenhouse emissions by between 2.4 and 2.6 million tonnes over the next five years.

Half of the cut is expected to come from the carbon tax and the rest from measures such as, possibly increasing the biodiesel mandate to five per cent from two, encouraging energy conservation and diverting organic waste from landfills.

A $102 million conservation trust fund announced in the Manitoba government’s March 12 budget will help fund projects to reduce greenhouse emissions and management water — a move also welcomed by KAP.

“When you look at the green plan we (farmers) have so much to offer Manitobans when we start working on this problem of excess greenhouse gases,” Mazier said. “There’s a lot of potential for Manitobans and agriculture here. The framework is getting set up and I really look forward to working on the green plan.

“We’ve got some major stuff coming at us but I think we’re up to the task because the government is interacting with us and looking at how agriculture can be part of the solution. If we are allowed to, I think you’ll see some pretty fantastic projects coming forward here in a few short years.”

If Manitobans want a road map to the Manitoba government’s plan they just need to read the Climate and Green Plan, he added.

Mazier expects the government’s next move will be to increase Manitoba’s biofuel mandate.

After much research and debating the pros and cons of a carbon tax, KAP was an early supporter of the Manitoba government’s plan long before the details were announced.

KAP’s thinking was there’s going to be a carbon tax so it should try to influence the process to mitigate the impact on farmers.

Pallister has said if Manitoba doesn’t tax carbon, Ottawa will impose its own tax starting at $10 a tonne this year and rising to $50 by 2020.

Manitoba’s plan is better because it will cost less, cut emissions by an extra 80,000 tonnes and let Manitobans decide how to spend the estimated $258 million in annual revenue the tax will raise, Pallister has said.

The government says it will return the carbon tax revenue to citizens through income and other tax cuts over the next four years.

A higher carbon tax to start should be more effective in encouraging people to reduce emissions, he said.

Pallister has also argued the Ottawa’s carbon tax doesn’t recognize the contribution Manitobans have, and continue to make, by funding Manitoba Hydro, which produces near zero-emission energy.

About the author


Allan Dawson

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.



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