Quebec to reimburse more than 15,000 farmers for fuel tax costs
Quebec will use $87 million from its climate change fund to reimburse fuel tax costs for more than 15,000 farmers in 2026 and 2027.
Quebec says it will begin reimbursing more than 15,000 farmers from July for fuel tax costs linked to the province's carbon market. CBC reported that the provincial government has committed a total of $87 million for reimbursements covering taxes farmers will pay in 2026 and 2027, with the money coming from Quebec's climate change fund.
The move follows years of complaints from the agricultural sector and from its main professional union, the Union des producteurs agricoles, or UPA. Premier Christine Fréchette used the announcement to fulfill a previous commitment and to address what farm groups have presented as a growing competitiveness issue in a period of higher operating costs.
Fréchette said the reimbursements should not remove the incentive for agriculture to keep reducing greenhouse gas emissions. Speaking at a biofood industry event in Drummondville, she argued that the farm sector would continue working to lower its carbon footprint. At the same time, she suggested the funding would help Quebec farmers compete with jurisdictions that do not impose equally demanding environmental standards.
UPA president Martin Caron described the decision as a major win for the competitiveness and scalability of farm businesses. He also said the organization expected the premier to keep pushing for a larger share of Quebec food in public institutions and for lower administrative and regulatory burdens. That framing shows the fuel-tax dispute is tied not only to direct input costs but also to broader farm policy and domestic food-market positioning.
The article also highlighted different estimates of the burden farmers have already carried under the carbon market. Opposition Liberals said farmers had paid $480 million over four years for their greenhouse gas emissions into the system. The governing CAQ, by contrast, put farmers' contributions at $140 million over four years and said the sector had also received an additional $290 million over that period for climate adaptation measures.
Quebec's cap-and-trade system is linked to California's and requires companies in major emitting sectors to bid regularly for emission allowances. As the cap declines over time, allowance prices rise, creating pressure either to cut emissions or to buy units from companies below the cap. For agriculture, the reimbursement decision shows the province is trying to preserve its carbon-pricing framework while reducing direct cost pressure on farm businesses.