Ford government introducing legislation to lower gas tax

The Ford government is tabling legislation on Monday to cut the gas tax by nearly six cents a litre in Ontario.

If passed, the gas tax would be cut by 5.7 cents per litre and the fuel tax by 5.3 cents per litre for six months beginning on July 1. Both taxes would be reduced to 9 cents per litre, down from 14.7 and 14.3 respectively.

“Ongoing supply chain challenges and geopolitical conflicts are pushing up the cost of living from gas to groceries,” said Peter Bethlenfalvy, Minister of Finance in a statement.

“With these added pressures, families and businesses need extra help to keep costs low. That is why our government is bringing forward legislation to provide tax relief at the pumps and put money back into people’s pockets.”

The July start date will provide the industry – including gas and fuel tax collectors, registered importers, wholesalers and retailers – the required time to adjust their systems and business processes.

This implementation time is required because of the way gas and fuel taxes are paid to the province, which includes pre-paid taxes.

The cut to the tax would remain in effect until Dec. 31, 2022.

Related:

• Ontario introduces new bill aimed to increase housing supply

• Ontario signs deal to bring $10/day child care to the province by 2025

Last month Alberta announced a plan to temporarily pause its tax of 13 cents a litre on gas and diesel. When asked if Ontario was going to follow suit, Energy Minister Todd Smith pointed to the elimination of licence plate sticker fees and the removal of tolls from two Toronto-area highways as his government’s plan to save money for drivers.

At the time, Smith indicated that any further taxation break “will be contingent on the federal government making a change.”

“Now is the time for the federal government to join us in providing relief for hard-working Canadians by cutting the carbon tax,” says Bethlenfalvy.

On April 1, gas prices across the GTA rose six cents a litre due in part to the federal government’s updated carbon tax, which added 2.2 cents to a litre of gasoline.

As of Sunday night, the price of a litre of gas had fallen to $1.659 from $1.739.

The total tax collected on a litre of regular unleaded gasoline in the province has now jumped from 33.5 cents to 35.7 cents.

In an effort to blunt the increase, the value of carbon-price rebate cheques from the federal government is set to jump more than 66 per cent in Ontario this year, and those payments will come quarterly, rather than hidden as a lump sum in annual tax-return deposits.

Visit CityNews for daily updates on gas prices across the GTA