With fuel prices breaking records at the pumps across Canada, Alberta premier Jason Kenney has announced his province will stop collecting the provincial fuel tax to offer some relief from skyrocketing costs.
“We’ve heard Albertans’ concerns about the rising cost of living loud and clear,” said Kenney in a press release on Monday. “While the federal government is set to increase the carbon tax April 1, Alberta’s government is taking the opposite approach and stepping up to offer relief.”
Kenney said that stopping the provincial fuel tax “puts money back in the pockets of Albertans when they need it most.”
Alberta finance minister Travis Toews said that many people expressed concerns about increasing prices when he consulted with them for this year’s budget.
“The best thing government can do during inflationary times is to spend less, borrow less and tax less,” said Toews. “That’s why today we are introducing new measures to help with the cost of fuel by reducing the provincial fuel tax, providing much-needed relief to everyday Albertans.”
The press release said that collection of the fuel tax would be paused for gasoline and diesel, which costs 13 cents per litre. Because the GST applies to provincial fuel taxes, the press release said that the 13-cent reduction will reduce the sales tax by 65 cents per litre, for a total savings of about 13.6 cents per litre of gasoline or diesel.
The Kenney government also said that it would review the collection of the fuel tax on a quarterly basis and consider reinstating it in stages rather than all at once, adding this would not begin sooner than July 1.
The Canadian Taxpayers Federation (CTF) applauded Alberta’s fuel tax relief and called on Prime Minister Justin Trudeau to scrap the federal carbon tax.
“Albertans need relief, so it’s great to see the Kenney government step up and cut the big tax bill drivers face at the pumps,” said CTF federal director Franco Terrazzano. “Trudeau needs to ditch his tax hikes and scrap the federal carbon tax.”
The federal carbon tax is set to increase to 11 cents per litre of gasoline on April 1, the third time it has gone up during the COVID-19 pandemic.
Trudeau has said that he would increase the federal carbon tax to nearly 40 cents per litre of gasoline by 2030.
