Tesla EV rebates frozen in Canada amid tariff dispute

The Canadian government has frozen all outstanding electric vehicle rebate payments to Tesla under its federal incentive program, according to a report from The Canadian Press.

Transport Minister Chrystia Freeland confirmed the freeze and stated that Tesla vehicles will no longer be eligible for future zero-emission vehicle incentives as long as U.S. tariffs on Canadian goods remain in effect. The decision follows the imposition of 25% tariffs on Canadian imports by U.S. President Donald Trump, with additional duties expected in the coming days.

According to the Toronto Star, Tesla submitted thousands of rebate claims in January during the final days of the incentive program. One dealership in Quebec City reportedly claimed nearly CAD 20 million (approximately USD 14 million) in subsidies after reporting the sale of over 4,000 vehicles in a single weekend.

The now-discontinued rebate program provided up to CAD 5,000 (approximately USD 3,509) toward the purchase of eligible electric or plug-in hybrid vehicles priced at or below CAD 55,000 (approximately USD 38,598).

This is the second recent action taken by a Canadian jurisdiction to restrict Tesla incentives. Earlier this year, the city of Toronto ended its financial incentives for Tesla vehicles used as taxis or ride-sharing vehicles, citing trade tensions.

Canadian officials are also reportedly responding to escalating trade tensions with their own set of tariffs on U.S. goods. In addition to trade concerns, there has been public backlash in Canada against Tesla CEO Elon Musk, who previously made controversial remarks about Canada. Reports of vandalism at Tesla dealerships in the country have also increased.