Ontario Proposes Extension of Gas and Fuel Tax Cuts Until 2025

The Ontario government has proposed legislation to extend the current tax cuts on gasoline and fuel until June 30, 2025. If passed, this extension would maintain the tax rates at 9 cents per litre, which the government claims will save Ontario households an average of $380 over three years since the cuts were first introduced in 2022.

The initial tax reduction, implemented on July 1, 2022, lowered the gasoline tax by 5.7 cents per litre and the diesel tax by 5.3 cents per litre. This measure was part of a broader strategy that included the cancellation of the cap-and-trade system, which the government states has resulted in a total savings of 10 cents per litre for drivers.

Premier Doug Ford has attributed the need for these measures to the financial pressures faced by families due to the federal carbon tax and high interest rates. Finance Minister Peter Bethlenfalvy echoed this sentiment, emphasizing the government's commitment to reducing costs for residents.

The proposed extension is part of the upcoming 2024 Ontario Economic Outlook and Fiscal Review. It builds on previous actions such as eliminating the licence plate renewal fee and banning new road tolls on provincial highways. The government has also removed tolls on Highways 412 and 418.

The extension of the tax cuts is positioned as a response to rising costs and is intended to provide financial relief to Ontario residents, particularly as the federal carbon tax is expected to increase in April 2025.