Canada has decided to halt all rebate payments for Tesla and exclude the electric-vehicle manufacturer from any upcoming EV rebate schemes, as stated by Transport Minister Chrystia Freeland. Freeland stated that payments will be withheld until each claim is scrutinized individually and deemed legitimate. In addition, Freeland has instructed the transport department to adjust the eligibility criteria for future iZEV programs to ensure that Tesla cars are ineligible due to the presence of "illegitimate and illegal U.S. tariffs against Canada."

Canada has put a hold on C$43 million ($30.11 million) in rebate payments for Tesla, with the directive being issued before Canadian Prime Minister Mark Carney called for a general election on April 28. The move was made following reports that Tesla made a large number of EV rebate claims right before the program ended in January, with a single Tesla dealership in Quebec City claiming over C$20 million in public subsidies by reporting more than 4,000 electric vehicle sales over a weekend.

Toronto has ceased providing financial incentives for Tesla cars used as taxis or ride shares due to trade disputes with the U.S. Tesla did not provide an immediate response to a request for comment from Reuters. U.S. President Donald Trump has initiated various tariffs, including a 25% tax on most goods from Canada and Mexico, with further automobile tariffs anticipated soon. Tesla CEO Elon Musk, a supporter of Trump, has been involved in efforts to reduce the federal government and budget as the head of the Department of Government Efficiency.