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Gas tax hikes show Trudeau doesn’t care about affordability

Author: Franco Terrazzano 2023/09/01

Prime Minister Justin Trudeau refuses to do the one thing that would immediately make life more affordable: cut gas taxes.  

The federal government makes you pay a fuel tax, a carbon tax, a second carbon tax and a sales tax every time you fuel up. In total, federal taxes add about 31 cents per litre to the price of gas, or about $20 extra to fuel up a large sedan.  

To add insult to injury, the feds and all six provinces east of Manitoba charge their sales taxes on top of the other taxes. This tax-on-tax adds about $2.65, on average, to the cost of fueling up a large sedan. If you fill up that sedan once a week, you’re paying about $140 every year just because of the tax-on-tax.

That big tax bill is only getting bigger.

Trudeau is cranking up his carbon tax until it hits 37 cents per litre of gas in 2030. The feds also recently imposed a second carbon tax through fuel regulations. When those fuel regulations are fully implemented in 2030, it’ll add up to 17 cents per litre to the price of gas. There are no rebates with the second carbon tax and it’s being layered on top of the original tax. 

In just seven years, federal taxes will cost about 74 cents per litre of gas. The two carbon taxes alone will cost the average family more than $2,000 every year, according to data from the Parliamentary Budget Officer. 

Gas taxes make life more expensive beyond the pumps. By making it more expensive for farmers to produce food and truckers to deliver food, the carbon tax makes it more expensive for families to buy food. 

The big rig truck driver that delivers groceries to the store pays more than $260 in federal taxes every fuel up. The carbon tax on propane and natural gas will cost Canadian farmers $1 billion through 2030, according to the PBO. 

Trudeau hiked his carbon tax every year since he first imposed it in 2019. Meanwhile, provincial governments of all stripes cut taxes. 

The United Conservatives in Alberta completely suspended their provincial fuel tax. The Progressive Conservatives in Ontario cut their fuel tax, saving the two-car family filling up once a week nearly $440.

British Columbia’s New Democrats paused a carbon tax hike to provide relief during the height of the pandemic. The Liberals in Newfoundland and Labrador cut their gas tax and continue to oppose Trudeau’s carbon tax hikes.

The multi-partisan Council of Atlantic Premiers launched a campaign to “fight the federal gas hike.” 

“Combined with the carbon tax this [second carbon tax] will increase the cost of everything – fuel, food, clothing and more,” Nova Scotia Premier Tim Houston said. “We are asking the federal government once again to work with us and not raise the price of everything.”

Across the pond, the United Kingdom announced billions of dollars in fuel tax relief. Sweden provided hundreds of millions of dollars in fuel tax relief. Australia cut its gas tax in half. South Korea cut its gas tax by about 30 per cent. The Netherland cut its gas tax by 17 cents per litre, while Germany cut its tax by 30 cents

Norway reduced fuel taxes to “help make everyday life a little easier for households and businesses.” India cut fuel taxes“to keep inflation low, thus helping the poor and middle classes.” IrelandIsraelItalyNew Zealand and Portugal also cut fuel taxes.

About three-quarters of countries don’t have a national carbon tax, according to the World Bank. Canadians now pay two. 

If Trudeau even remotely cared about making life more affordable, he would follow in the footsteps of provinces and countries of all political stripes, and reduce his gas taxes.

This column was originally published in the Toronto Sun on Sep. 1, 2023.


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Franco Terrazzano
Federal Director at
Canadian Taxpayers
Federation

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