Canada cuts Tesla from EV rebate payments and freezes $30M over US tariffs
Canada bans Tesla from EV rebates (Illustrative photo: Getty Images)
Canada has suspended all EV rebate payments to Tesla and barred the automaker from participating in future incentive programs. The decision was announced by Transport Minister Chrystia Freeland on Tuesday, reports USA Today.
According to Freeland, Tesla will no longer be eligible for the iZEV rebate program "as long as the illegitimate and illegal US tariffs are imposed against Canada."
She added, "No rebate payments will be made until each claim is individually investigated and determined to be valid." As a result, the Canadian government has frozen 43 million Canadian dollars (about $30.11 million) in pending Tesla rebates.
The move follows the announcement of new 25% tariffs by US President Donald Trump on most imports from Canada and Mexico.
Trump also warned of upcoming auto tariffs, some of which may take effect as early as April 2. In response, Canada has tightened its policies on American companies - starting with Tesla.
Mass rebate claims and pre-election backdrop
Further concern was sparked by a surge in Tesla rebate applications at the end of the program. According to The Toronto Star, a Tesla dealership in Quebec submitted nearly C$20 million in claims for over 4,000 EV sales in a single weekend. These filings came in January, just before the program ended, prompting government scrutiny.
The freeze order was issued shortly before Prime Minister Mark Carney announced a general election scheduled for April 28. Earlier in March, Toronto also revoked municipal incentives for Tesla vehicles used as taxis and ride shares, citing rising trade tensions with the US.
Public trust in Tesla has also been shaken by growing dissatisfaction with its CEO. Over 230,000 Canadians have signed a petition demanding that Elon Musk be stripped of his Canadian citizenship.
