Ontario to extend its gas and fuel tax rate cut until year end

Ontario’s gas and fuel tax rate cut. Image credit: X/@VictorFedeli

Toronto/CMEDIA: Ontario Premier Doug Ford announced Mar 25 that as part of Ontario’s March 26 budget, gas and fuel tax rate cut will now remain in place until Dec. 31.

“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.

“It’s never been more important to keep costs down,” Ford said at a press conference in Mississauga. “We’re on a relentless mission to save people money.”

The government will introduce legislation to extend the gas tax cut until Dec. 31, 2024, through its 2024 budget, which will be tabled on Tuesday, March 26.

Gas tax and fuel tax rate cuts have been effective since July 1, 2022, and were scheduled to expire on June 30, 2024.

Since first introduced in 2022, Ontario’s tax rate cut has reportedly caused Ontario households to save an average of $320 over the last two and a half years.

The cut was proposed as a way to combat inflation as well as the federal carbon tax, which imposes a tax on gasoline in those provinces which do own levy on greenhouse gas emissions.

After coming into effect at $20 per tonne in 2019, the carbon tax  has steadily been climbing in the years since and is scheduled to rise from $65 per tonne to $80 on April 1.

On Monday, Ford reiterated his call for either the cancellation of the pausing of the federal carbon tax.

Ford’s government is also proposing legislation that would require a referendum if future governments decide to institute a carbon tax in Ontario.

Last month Ford had said if passed, the new legislation would give voters a “direct say” over any new provincial carbon tax, cap-and-trade system,  or other carbon pricing program.

Future governments can repeal this legislation if they have enough support.