Canadians for Affordable Energy says not every province is in a financial position like Alberta to remove its provincial fuel tax, even though they should.

Alberta Premier Danielle Smith said on Thursday her government will “lock in” the fuel tax holiday for Albertans, one day after Nova Scotia Finance Minister Allan MacMaster said he can’t remove the provincial fuel tax because the federal government won’t allow it. 

Dan McTeague, president of Canadians for Affordable Energy, said Nova Scotia doesn’t have many options to offset the revenue from the fuels tax, while Alberta can rely on its oil reserves. 

“They have no way of making it up, they have nothing to fall back on,” McTeague told True North. 

“The provinces are not in the same financial position as Alberta. They’re having trouble and they don’t really have much room to drop the tax, even though they ought to.” 

Nova Scotia’s provincial tax, or the motive fuel tax, is expected to raise nearly $260 million for the provincial government this year.

Newfoundland and Labrador reduced its provincial fuel tax by almost half earlier this year as a temporary measure. In July, Ontario reduced its gas tax by 5.7 cents per litre and the fuel tax by 5.3 cents per litre, a reprieve that will last until the end of the year. 

Former Alberta premier Jason Kenney first removed the provincial fuel tax on April 1, as oil prices skyrocketed and as a federal carbon tax increase to $170/tonne came into effect. When oil prices relaxed in October, the province partially reinstated its fuel tax to 4.5 cents per litre on gas and diesel.

Speaking at the Rural Municipalities of Alberta fall 2022 conference on Thursday, Smith said her government will take decisive action in the coming weeks to help Albertans “cope with the worst financial pressures.” 

“Our government is also going to lock in removing the provincial fuel tax and ensure that the gas stations lower the prices appropriately when we do that,” she said. 

“Alberta is home to massive energy resources which belong to you and it’s time to ensure that you benefit from that ownership.”

On Wednesday, Nova Scotia Finance Minister Allan MacMaster said he can’t cut into the 15.5 cents tax per liter tax on gasoline or diesel because the federal government won’t allow it. 

“They’ve just simply said we can’t do it.” MacMaster said. “There is a federal document that you cannot go and offset the carbon pricing because it would defeat the purpose of what they’re trying to do, which is trying to raise the price of fuel, so people stop buying it.”

Yet, federal Immigration Minister and Nova Scotia MP told the CBC the province is free to follow the lead of other provinces and cut provincial fuel taxes. 

McTeague said the Liberal government wants to tax energy, the very thing people use to survive. He said the federal Liberals and their colleagues in the New Democratic Party are committed to “undermining affordability.”

“We’ve been saying it for five or six years; people are starting to believe us.” 

Author

  • Rachel Emmanuel

    Rachel is a seasoned political reporter who’s covered government institutions from a variety of levels. A Carleton University journalism graduate, she was a multimedia reporter for three local Niagara newspapers. Her work has been published in the Toronto Star. Rachel was the inaugural recipient of the Political Matters internship, placing her at The Globe and Mail’s parliamentary bureau. She spent three years covering the federal government for iPolitics. Rachel is the Alberta correspondent for True North based in Edmonton.

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