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Conservative Leader Pierre Poilievre is reiterating his call for Prime Minister Mark Carney to extend a pause on Canada’s fuel excise tax, which is set to return on Labour Day.
Ottawa temporarily removed the tax from retail gas sales in April, a measure that will expire on Sept. 7. In a letter to Carney on Sunday, Poilievre argued the tax should remain paused until at least Canada Day 2027.
“When Conservatives first called on you to take all federal taxes off gas and diesel until the new year, Canadians were already struggling with the cost of living,” Poilievre wrote. “Since then, things have not gotten better. They have gotten worse.”
Poilievre said gas prices are rising again and grocery price inflation remains high, pointing to a recent report by the Organisation for Economic Co-operation and Development, which showed Canada had the highest food price increases in the G7.
Worldwide oil prices remain elevated in the fallout from the Iran war amid supply disruptions and constraints.
The Strait of Hormuz, which normally sees about a fifth of the world’s crude oil and other supplies, is largely closed to cargo traffic for fear of attacks. That’s on top of significant damage done to neighbouring oil, gas, energy and maritime shipping infrastructure and facilities.
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The price of U.S. oil, known as West Texas Intermediate, was hovering close to US$82 per barrel as of publication, down from a recent high of about $83 on Wednesday and up from $75 a week earlier.
The Canadian Automobile Association says the national average price for regular grade gasoline in Canada is about CAD$1.67 per litre, up from $1.64 a week ago and from $1.33 at the same time last year.
Carney suspended of the fuel excise tax largely due to the U.S.-Iran war.
Drivers have been saving about 10 cents per litre on gasoline and four cents per litre on diesel while the pause has been in place.
“A tax hike on fuel is a tax hike on everything,” Poilievre wrote.
It’s not the first time Poilievre has called for an extension of the freeze in recent days, asking on Aug. 6 for Carney to “cancel the hike.”
Ottawa is also being pressed by the Conservative leader to not only drop the excise tax, but to remove all taxes on gas as well, saying it would save Canadians even more money.
“This would lower the price at the pump and make groceries, home building materials and other products that are transported more affordable to Canadians,” Poilievre said in a news conference on Sunday.
Poilievre isn’t the only politician urging Carney to extend the excise tax pause. Earlier this month, Ontario Premier Doug Ford asked Carney to extend the suspension of the fuel excise tax until at least Jan. 1, or consider making the suspension permanent.
The prices consumers pay for gasoline and diesel at retail are based on a combination of factors, including global expectations of supply and demand for crude oil, in addition to various taxes and other charges businesses may pass along to consumers.
The federal excise tax charged on products such as gasoline is separate from other taxes, such as HST, which remains in effect.
Depending on the region, bringing back the excise tax could mean an increase of roughly 10 cents to 11 cents per litre, according to Dan McTeague, president of Canadians for Affordable Energy.
—with files from Global News’ Ariel Rabinovitch
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