Canada will eliminate consumer carbon price April 1

Canadians may see lower gas prices as the federal carbon price will be eliminated starting April 1, according to a report from Desjardins Economics. The gas price drop could be almost 18 cents per litre, meaning drivers could save about $9 on a full tank. The report comes shortly after Prime Minister Mark Carney announced the removal of the consumer carbon levy, which aimed to reduce greenhouse gas emissions. This change is expected to lower overall inflation over the next year. The last rebate connected to the carbon price will also be issued in April. Desjardins forecasts that the price of natural gas may fall by nearly 13% in the same time period. While the carbon price is currently active across Canada, provinces like British Columbia, Quebec, and Northwest Territories have their own systems. British Columbia plans to eliminate its carbon tax following the federal decision. Economists expect that, although gas prices may drop quickly, grocery prices will change more gradually as lower transportation costs slowly influence food prices. In April, inflation is predicted to be 0.7% lower due to the end of the carbon pricing, bringing the annual inflation rate to about 2.1%. Bank of Canada officials believe that the removal of the carbon price could help ease inflation rates. However, some experts warn that other factors, like ongoing trade disputes, may also impact prices. They suggest the effects of the end of the carbon tax may not be felt immediately in the grocery store as prices on perishable goods could rise due to other pressures.