Carney government to cut gas tax temporarily, prices expected to drop 10¢/L

Canada’s federal government is temporarily dropping its federal fuel excise tax starting next Monday amid unstable gas prices. 

Prime Minister Mark Carney announced the temporary change on Tuesday during a news conference in Ottawa. 

According to him, the suspension will be in effect starting next Monday, April 20, and end on Labour Day, Sept. 7, and aims to provide relief to Canadians as gas prices have been unstable due to conflicts in Iran. In addition, the government is also dropping the fuel excise tax on aviation fuels. 

The temporary relief is expected to drop prices by $0.10 per litre on gasoline and $0.04 per litre on diesel fuel. 

“Combined with our earlier elimination of the consumer carbon tax, our government will have reduced fuel prices on gas by up to 0.28 per litre. That’s real relief for you and your family at the end of the day,” Carney told reporters. 

Since the U.S.-Iran conflict started, prices have been fluctuating worldwide, including in Toronto, where drivers are reportedly paying more than 20 per cent more per litre in March than before the conflict started in February. 

“We can’t control what other countries do. We can control what we choose to do. And we choose to build a Canada strong for all Canadians,” the prime minister added. 

Carney’s announcement comes a week after Conservative Leader Pierre Poilievre urged the prime minister to use $5 billion of the $9 billion in additional gas revenue to remove all federal gas and diesel taxes to help Canadians afford to fill up their tanks. 

In addition, at the time, the opposition leader had recommended the federal government also remove GST on gas and diesel.