Canadian Tax and
Financial Information
Fuel Efficient Vehicles

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Sales Taxes -> Provincial Sales Tax -> 
    Financial Planning -> Save Money -> Fuel Efficient Vehicles - Rebates and Incentives

Rebates for Fuel Efficient Vehicles

The federal government and some provinces provide rebates when fuel efficient vehicles, hybrid vehicles, or alternative fuel vehicles are purchased.  See the following links:

Federal iZEV Program

The federal incentive program for zero-emission vehicles (ZEVs) will provide incentives of up to $5,000 for consumers who buy or lease an eligible ZEV.  The program will be in effect May 1, 2019.

British Columbia Rebates for Fuel-Efficient Vehicles

The Province of BC offers incentives of up to $5,000 for the purchase or lease of a new battery electric or plug-in hybrid electric vehicle, and up to $6,000 for a hydrogen fuel cell vehicle.

See Government of BC CEVforBC Vehicle Incentive Program, and their Clean Energy Vehicles for BC website.

In BC there is also a carbon tax on fuel to encourage fuel conservation.  See BC Ministry of Finance on Carbon Tax.

Ontario Rebates for Fuel-Efficient Vehicles

In 2018, Ontario cancelled the cap and trade program, which funded the Electric and Hydogen Vehicle Incentive Program and the Electric Vehicle Charging Incentive Programs.  These programs were cancelled.  See the Ontario Government information Ministry of Transportation website.

Quebec Rebates for Fuel-Efficient Vehicles

The rebate for an all-electric or a plug-in hybrid vehicle is either $4,000 or $8,000, and for a non-plug-in hybrid vehicle is $500.  Financial assistance is available for the purchase and installation of a 240 volt charging station at your home, for up to 50% of eligible expenses or $1,000, whichever is less.  There are also rebates for eligible used all-electric vehicles.  See the Government of Quebec Discover Electric Vehicles website for more information, including lists of eligible vehicles, and information on electric vehicles and charging stations.

Canadian Excise Tax on Fuel-Inefficient Vehicles

To encourage Canadians to make eco-friendly consumer choices, the Government of Canada adopted an excise tax (or green levy) on fuel-inefficient vehicles.  See Canada Revenue Agency publication ETSL64 Excise Tax on Fuel-Inefficient Vehicles.  There is a list of vehicles and their applicable excise tax for each year after 2006.  For 2018, the highest tax was $4,000 per vehicle, but the majority of vehicles have no tax.

Which Vehicles are Fuel-Efficient?

Natural Resources Canada has information on the Most Fuel-Efficient Vehicles.  Even if you don't get a rebate, you can save money on gas!

Tax Tip:  Even if you don't get a rebate, you may be able to save a lot using a fuel-efficient vehicle!

Revised: July 30, 2019


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