Ottawa blocks rebate payments to Tesla, bars it from future subsidies

The federal government is pausing payments that are to be made to EV-manufacturing giant Tesla under Ottawa’s subsidy program and has barred the company from future rebates in other programs until the threat of U.S. President Donald Trump’s tariffs on Canada is withdrawn, Transport Minister Chrystia Freeland’s told Global News.

Freeland is currently running for re-election as the Liberal MP for University-Rosedale.

“As soon as I became Transport Minister, I asked the department to stop all payments for Tesla vehicles in order to fully examine each claim individually and determine whether all are eligible and valid. No payments will be made until we are confident that the claims are valid,” Freeland told Global News in an emailed statement.

According to the Toronto Star, Tesla filed 8,653 rebate claims over a 72-hour span in January shortly before the program was set to end.

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Freeland added that the company, which is owned by key Trump aide and billionaire Elon Musk, will not be eligible for the Incentives for Zero-Emission Vehicles (iZEV) program in the future.

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“I also directed my department to change the eligibility criteria for future iZEV programs to ensure that Tesla vehicles will not be eligible for incentive programs so long as the illegitimate and illegal U.S. tariffs are imposed against Canada,” Freeland said.

While she was campaigning to be Liberal leader, Freeland had called for a 100 per cent tariff on Tesla vehicles, given Musk’s position in the Trump administration.

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The federal NDP have urged Ottawa to put a 100 per cent tariff on Tesla vehicles.

Musk has praised Conservative Leader Pierre Poilievre in the past. In January, before Trump’s inauguration, Poilievre was asked what he thought of Musk’s endorsement.

“It would be nice if we could convince Mr. Musk to open some of his factories here in Canada and create some high-paying jobs for our people,” Poilievre said.

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The Conservatives haven’t said whether they want to see a tariff on Teslas.

Trump’s tariffs on Canada have triggered protests against Musk, one of Trump’s top advisers, in Canada. Tesla dealerships across Canada have seen protests against the electric vehicle manufacturer.

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Several Canadian provinces have taken punitive actions against the Musk-owned company. Nova Scotia and Manitoba have both made Tesla cars ineligible for their respective EV rebate programs.

In a move to give preference to Canadian goods and exclude U.S.-produced goods, the B.C. government announced earlier this month that Tesla products are no longer eligible for the electric vehicle charger rebate program for single-family homes.

The program provides rebates to help homes and workplaces in the province get ready for electric vehicles.

Ontario Premier Doug Ford decided to rip up a $100-million contract it had with Musk-owned internet provider Starlink, which Ford said would not be back on the table even if the U.S. tariffs on Canada were lifted.