Pierre Poilievre wrote to Mark Carney on Sunday asking that the pause on the federal fuel excise tax remain in place until Canada Day 2027. The Conservative leader said Canadians are still feeling the strain of high fuel and grocery prices and that a tax hike would worsen the situation.
Tax suspension timeline
Ottawa removed the excise tax from retail gasoline and diesel in April as a temporary measure. The suspension is scheduled to end on 7 September, the day before labour day. The Canadian Automobile Association reports the national average price for regular gasoline is about C$1.67 per litre, up from C$1.64 a week ago and well above C$1.33 at the same time last year. While the freeze has been in effect, drivers have saved roughly ten cents per litre on gasoline and four cents per litre on diesel.
Political pressure on the finance ministry
Poilievre cited a recent report from the OECD that placed Canada at the top of the G7 for food price inflation. He also pointed to the ongoing disruption of oil supplies after the Iran‑U.S. conflict, noting that the Strait of Hormuz is largely closed to cargo traffic. The price of West Texas Intermediate crude was near US$82 a barrel at the time of writing, down slightly from a recent high of US$83 and up from US$75 a week earlier.
The Conservative leader argued that a fuel tax increase is effectively a tax increase on everything that relies on transport, from groceries to building materials. He called for the removal of all federal taxes on gasoline and diesel, saying it would lower pump prices and ease the cost of goods across the country.
Ontario Premier Doug Ford has also asked Carney to extend the suspension until at least 1 January or to make the freeze permanent. The federal excise tax is separate from the harmonised sales tax, which continues to apply to fuel purchases.
According to Dan McTeague, president of Canadians for Affordable Energy, reinstating the excise tax could add roughly ten to eleven cents per litre to the price at the pump, depending on the region.
Based on reporting by Global News.