Alberta Sticks to Fuel Tax as Federal Relief Measures Announced
Prime Minister Mark Carney revealed federal initiatives to ease the burden on Canadians at the gas pumps on Tuesday. However, Alberta has confirmed that its fuel tax will remain unchanged for now. Finance Minister Nate Horner expressed support for Ottawa’s actions but emphasized that Alberta will uphold its current fuel tax until at least July, citing the unpredictable nature of oil prices.
Horner highlighted that Alberta does not have a provincial sales tax, unlike the federal government’s GST on fuel. He urged for recognition of Alberta’s stance on taxation while also suggesting that more could be done by the federal government.
Under Alberta’s current program, the province would waive the 13 cents per litre tax if the North American West Texas Intermediate price averages at or above US$90 per barrel during portions of May and June. As of Tuesday afternoon, WTI prices were above the US$90 mark.
Opposition NDP Leader Naheed Nenshi has been pushing for Premier Danielle Smith’s United Conservatives to eliminate the levy, especially in light of the recent Middle East conflict causing a surge in global oil prices. Nenshi criticized the government for not taking swift action to address the significant price fluctuations, accusing them of holding onto windfall royalty revenues.
The province’s budget, outlined just before the U.S.-Israeli attacks on Iran, projected a $9.4-billion deficit for 2025-26, with the budget heavily reliant on oil revenues. Nenshi emphasized the potential savings for the average family if the fuel tax were adjusted, urging the government to act promptly.
In response, Premier Smith defended her government’s decisions, pointing to a recent personal income tax cut that benefited many households. She emphasized the importance of managing surplus and windfall revenues to provide relief to taxpayers.
The federal government’s fuel excise tax break, set to commence next Monday, is estimated to save Canadians 10 cents per litre on regular gasoline and four cents per litre on diesel until Labour Day. The current average gas price across Canada, according to the Canadian Automobile Association, stands at $1.73 per litre, over 40 cents higher than a year ago.
Carney mentioned that the temporary waiver of the excise tax will result in a revenue loss of approximately $2.4 billion. Alberta Energy Minister Brian Jean refrained from commenting on the provincial gas tax, deferring to Minister Horner, but highlighted that Albertans are in a comparatively advantageous position due to global circumstances.