Ontario makes gas tax cut permanent despite carbon tax

Ontario Premier Doug Ford will keep his promise to permanently cut the provincial gas tax by 5.7 cents per litre. This plan will proceed even after the federal government changed its stance on the carbon tax. On Friday, Prime Minister Mark Carney announced that the consumer fuel charge will end on April 1. This change is expected to lower gas prices in Ontario by about 17.6 cents per litre. Ford welcomed this news, describing the carbon tax as “the worst tax ever” after the announcement. The federal carbon tax was put in place after Ford’s government cancelled the cap-and-trade program in 2018. That program had generated $2.9 billion for green energy projects and electric vehicle rebates. Following its end, Ford’s government introduced a new plan, costing $1 billion a year, which gave the gas tax discount. During the recent election campaign, the Progressive Conservatives pledged to make this gas tax cut lasting. A spokesperson confirmed that the government plans to continue this discount, even with Ottawa's changes. There is still uncertainty about how the province will handle the carbon price for industries, which is similar to the federal charge. In 2022, Ontario launched the Emissions Performance Standards program aimed at encouraging emissions reductions in industrial sectors. This carbon price will increase to $170 per tonne by 2031. Grace Lee, a representative from Ford's office, emphasized the need for all government levels to reduce costs and support businesses. However, no clear answers were provided regarding potential changes to the industrial carbon price. Green Party member Aislinn Clancy expressed concern about the government's lack of clarity on this matter, suggesting that they are being cautious due to job concerns related to tariffs. The government noted that the industrial carbon price has generated around $400 million, which is largely reinvested into the companies contributing to it.