The Climate Action Incentive (CAI) payment is a tax-free amount paid to help individuals and families offset the cost of the federal pollution pricing in Canada. It is available to residents of Alberta, Saskatchewan, Manitoba, and Ontario. The CAI payment consists of a basic amount and a supplement for residents of small and rural communities. The government of Canada calls the tax "revenue neutral" because all direct proceeds of the program go directly back to residents in the provinces where the federal system was forcefully adopted. The CAI payment was previously a refundable tax credit claimed annually on personal income tax returns, but the government of Canada has changed the payment method for the CAI from a refundable credit claimed annually on personal income tax returns to quarterly tax-free payments made through the benefit system starting in July 2022. The amount of the payment depends on the family situation and the province of residence. The payment for the CAI is universal and therefore not subject to a benefit reduction based on adjusted family net income.