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Finance says Ottawa will propose temporarily setting federal fuel excise tax to zero from April 20 to Sept. 7, 2026

Justin Barber

Apr 15, 2026 — 1 min read

The federal Department of Finance says the federal government intends to introduce amendments to the Excise Tax Act that would temporarily set the federal fuel excise tax to 0 cents per litre on gasoline, diesel fuel and aviation fuels from April 20, 2026, through Labour Day, Sept. 7, 2026. The change would take effect only if Parliament passes the amendments.

If approved, the proposed suspension would apply nationwide, including in Northeast Ontario, and would temporarily change the federal tax rates that apply to several common fuels.

Finance said the measure is intended to address fuel-price pressures it attributes to global oil disruptions related to the Middle East conflict.

The federal excise tax is currently 10 cents per litre on gasoline and unleaded aviation gasoline, and 4 cents per litre on diesel fuel and aviation fuel other than aviation gasoline.

The tax is typically paid by the manufacturer or wholesaler when fuel is delivered to a retailer, and is built into the price of fuel, including at the pump, Finance said.

Under the proposal, the 0-cent rate would apply to fuel for which the excise tax becomes payable after April 19, 2026. Finance said this would include fuel delivered by a manufacturer or producer to a purchaser, sold by a licensed wholesaler, or imported into Canada after April 19.

The proposed suspension would remain in effect through Sept. 7, 2026. On Sept. 8, 2026, the excise tax would return to 10 cents per litre for gasoline and unleaded aviation gasoline, and 4 cents per litre for diesel fuel and aviation fuel other than aviation gasoline.

Heating oil is exempt from the federal fuel excise tax, and there is no federal excise tax on natural gas or propane. Provinces also collect their own gasoline and diesel taxes.

Finance estimated the suspension would total over $2.4 billion in federal excise tax savings in 2026.

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