Phase out inefficient fossil fuel industry subsidies over the medium-term.

What success looks like

Phase out inefficient fossil fuel subsidies, consistent with Canada’s commitment with the G20 countries, building a strong, clean economy and preserving the planet for generations to come.

Government's narrative on progress

Inefficient fossil fuel subsidies can encourage wasteful consumption, impede investment in clean energy sources and undermine efforts to fight the threat of climate change. Canada has committed to rationalize inefficient fossil fuel subsidies by 2025. To date, Canada’s efforts to reform fossil fuel subsidies have resulted in the phase-out or rationalization of eight tax expenditures, which are being introduced gradually to enable the industry to adapt. Actions taken include: rationalizing the tax treatment of expenses for successful oil and gas exploratory drilling (announced in Budget 2017 and to be completed by 2021); phasing out a tax preference that allows small oil and gas companies to reclassify certain development expenses as more favorably treated exploration expenses (announced in Budget 2017 and to be completed in 2020); and, announcing that the accelerated capital cost allowance for liquefied natural gas facilities would expire as scheduled in 2025 (announced in Budget 2016). Canada will continue to review measures that could be considered inefficient fossil fuel subsidies with a view to reforming them as necessary. As part of that work, Canada and Argentina recently committed to undergo peer reviews of inefficient fossil fuel subsidies under the G20 process. This report will be made public once the peer review is finalized.

Note: this is the government's own description, not an independent assessment.