Federal carbon tax increases on April 1, some provinces help relieve the pain

Truckers in some provinces will see diesel go up as federal carbon tax is set to increase on April 1. It has been climbing since it came into effect in 2019, when it was first introduced at $20 per tonne. As of next Monday, the price will be raised 23%, reaching $80 per tonne.

This affects all the provinces except B.C. and Quebec. While the scheduled increase will apply in Ontario, Manitoba, Saskatchewan, Alberta and Yukon and Nunavut, the carbon price jump in Newfoundland & Labrador, Nova Scotia, and Prince Edward Island will go into effect on July 1.

And some provinces take action to relieve the stress that comes with it.

Ontario’s Premier, Doug Ford, announced today that the province is extending gas tax cuts. The province temporarily cut the gasoline tax by 5.7 cents per liter, and the fuel (diesel) tax by 5.3 cents per liter from July 1, 2022, to June 30, 2024.

The extension of the cuts ensures the rates remain at 9 cents per liter until Dec. 31 this year, saving Ontario households $320 on average over the two-and-a-half years since the tax rate cuts were first introduced, a news release said.

“With the federal government about to increase its costly carbon tax, it’s never been more important to provide relief at the pumps and put hundreds of dollars back into peoples’ pockets,” Ford said in the release.

Alberta

In Alberta, the provincial government is set to fully reinstate its fuel tax following a drop in oil prices.

Finance minister Nate Horner said in a release that the provincial fuel tax for gas and diesel will be 13 cents per liter starting April 1. This is due to oil prices averaging below $80 per barrel during the most recent quarterly review period.

“In 2024-25, fuel tax revenue is forecast at $1.4 billion, which will help fund everything from better roads to improved health,” Horner added.

Manitoba

Manitoba Premier Wab Kinew said last week he is considering extending Manitoba’s fuel-tax holiday, which is set to expire at the end of June. The province implemented the tax holiday, suspending the 14-cent-a-liter provincial fuel tax on Jan. 1, 2024, with the intention to help the residents deal with inflation.

It is unclear if Kinew will announce a decision before the budget set for April 2.

He referred to the recent closure of an Imperial Oil pipeline that brings gasoline, diesel and jet fuel to Winnipeg from Gretna, Man., replace the pipeline supply while repairs are done.

“The situation with the pipeline is something that we’re learning to live with over the next few months and we’re going to be there to help keep life affordable in Manitoba,” Kinew said.

With files from The Canadian Press