Ontario government moves to extend 5.7 cent gas tax cut to June 2025

Ontario is moving to extend a 5.7-cent cut to the provincial gas tax until next summer.

Speaking at a news conference in Etobicoke on Sunday, Premier Doug Ford said his government will soon put forward legislation that, if passed, will keep the tax at nine cents per litre until June 30.

"I keep an eye on the gas prices all the time, morning, noon and night," Ford said.

"In 2022, we introduced a temporary gas and fuel tax cut by 10.7 cents per litre, saving households hundreds of dollars over the last two years.

"Today I'm thrilled to announce that as part of our fall economic statement, we'll be extending this tax cut through to June 30th, 2025, saving households approximately $380 a year over the three years since the cuts were first introduced," he added.

The legislation would also extend the 5.3-cent cut to the price of diesel fuel.

The province first temporarily slashed the gasoline and diesel tax rates in July 2022 but have repeatedly extended the cuts since.

Ford calls federal carbon tax 'absolutely ridiculous'

Ford also used the extension announcement to call on the federal government to eliminate the federal carbon tax, which Ford has long railed against.

He said the carbon tax contributes to squeezing the budgets of families and businesses right across this province.

"It's a terrible, terrible tax. It's a terrible policy. It now adds 17.6 cents to every litre of gas you purchase, and it's set to increase again on April the 1st, 2025 to 20.9 cents per litre, bumping up the cost of everything once again. It's absolutely ridiculous."

The carbon tax, also known as a price on carbon, came into effect at $20 per tonne in 2019. It has steadily climbed in the years since.

It is scheduled to go up another $15 each year until 2030, when it reaches $170 a tonne. The gradual increases are meant to act as a financial incentive for people and businesses to change their behaviour to burn less fossil fuels and transition to greener forms of energy.

In addition to Ontario, the carbon tax also applies to residents in Newfoundland and Labrador, New Brunswick, Nova Scotia and Prince Edward Island, Manitoba, Saskatchewan, Alberta, Yukon and Nunavut.

Ninety per cent of the government revenues are returned to households in those provinces through a quarterly rebate program, with households receiving a quarterly payment based on family size.

The other 10 per cent is to help grant recipients, such as businesses and schools, reduce their fossil fuel consumption.

Ontario's Finance Minister Peter Bethlenfalvy — who also spoke at Sunday's news conference — said the 2024 Ontario Economic Outlook and Fiscal Review, which will be presented in a few days, will show how the government is building on its plan to protect the economy and provide relief for people, including transit riders and drivers right across the province.