How does Ontario’s gas tax cut compare to other provinces?

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Ahead of the unveiling of the Ontario budget today, Ontario Premier Doug Ford announced that a 5.7-cent per litre cut to the gas tax cut will continue to the end of the year.

Ford introduced the cuts, which also lower diesel prices by 5.3 cents per litre, on July 1, 2022. Intended to provide financial relief to families and businesses, the cuts were initially set to expire at the end of 2023.

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That deadline was later bumped to June 30, 2024, before Ford announced yesterday that it had been extended again.

Here’s what to know.

How much money have people saved as a result of the cuts?

The Ford government estimates that the cuts have saved households an average of $320 over the two and a half years since they were first introduced.

“Our government really knows that high inflation and high interest rates are putting immense pressure on the pocketbooks of Ontarians,” Finance Minister Peter Bethlenfalvy said, per CBC. “That’s why we acted early to keep costs down and protect people and businesses from the rising cost of everything.”

The savings depends on a number of factors, including one’s driving habits and their vehicle’s fuel efficiency.

Per the Canadian Taxpayers Federation (CTF), the gas cut has saved Ontario families about $450 each since its implementation. Taxes account for about 32 per cent of the pump price in Ontario, translating to roughly 52 cents per litre.

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How does it compare to other provinces?

Ontarians have the fourth lowest gas tax burden, according to CTF’s annual Gas Tax Honesty Report.

Seven provinces have their own carbon pricing systems, including B.C. and Quebec.

B.C.’s carbon tax, North America’s first carbon pricing program, began in 2008 at a rate of $10/tonne and increased annually until it reached $30/tonne in 2012. It currently stands at $65/tonne.

Quebec had a carbon tax from 2007 to 2012 but moved to a cap-and-trade system in 2012, with a current tax rate of $22.40/tonne of emissions​​.

According to Statistics Canada data for February, Vancouver was the most expensive place to fill up, with an average retail price for regular gasoline of 175.8 cents per litre. It was followed by Whitehorse (169.9 cents per litre), Victoria (169.6 cents per litre) and St. John’s, Nfld. (168.4 cents per litre).

Here’s how the remaining locations ranked based on the data available:

• Montréal: 163.3 cents per litre
• Québec City: 162.8 cents per litre
• Charlottetown and Summerside, P.E.I.: 162.4 cents per litre
• Halifax: 160.6 cents per litre
• Saint John, N.B.: 158.5 cents per litre
• Yellowknife: 157.0 cents per litre
• Thunder Bay, Ont.: 149.9 cents per litre
• Toronto: 148.5 cents per litre
• Ottawa-Gatineau: 148.3 cents per litre
• Regina: 139.3 cents per litre
• Saskatoon: 139.3 cents per litre
• Calgary: 134.5 cents per litre
• Edmonton: 129.9 cents per litre
• Winnipeg: 125.6 cents per litre

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How much does the federal carbon tax contribute to gas prices?

All provinces, save for Quebec, are required by the federal government to adhere to a minimum carbon tax rate. The rate, which has been increasing annually since 2019, reached $65 per tonne in 2023. By 2030, the tax is planned to reach $170 per tonne.

Per the CTF, the carbon tax adds approximately 14.3 cents to each litre of gasoline and is projected to rise to about 37.4 cents per litre by the end of the decade.

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