The federal government is pausing the implementation of the carbon tax on home heating oil for the next three years to help alleviate the financial pressures felt by people unable to make the switch to electricity.

Prime Minister Justin Trudeau, flanked by members of the Atlantic Canada Liberal caucus, announced a number of additional measures to help address the rising cost of living, including the installation of free heat pumps for those who make at or below the median household income. That’s in addition to a $250 upfront payment for low to median income households who heat their homes with oil and sign up for a heat pump through a joint federal-provincial government program. The project is being piloted in the Atlantic region first.

The rural top-up provided as part of the quarterly pollution price rebates is also being doubled from 10 to 20 per cent.

Premier Andrew Furey and his Atlantic Canadian counterparts have been reiterating the impact the carbon tax is having on people in the region. Furey called it a “good day” for the province.

Our government has been pressing upon the federal government that its carbon tax unfairly impacts Newfoundlanders and Labradorians, so we are pleased to see some changes to help lighten the burden in our province. #nlpoli pic.twitter.com/yzfE8E0Jxl

— Andrew Furey (@FureyAndrew) October 26, 2023

The federal government says Atlantic Canada has the highest proportion of residents living outside urban areas and the highest proportion of people who heat their homes with oil.

The announcement came on the eve of an “ax the tax” rally hosted by Conservative Leader Pierre Poilievre planned for Friday evening in St. John’s.