Commentary

Newfoundlanders and Labradorians face major gas tax hike

Jay Goldberg Jan 09, 2024 | Newfoundland and Labrador

Forty dollars a month. That’s how much Premier Andrew Furey’s gas tax cut has saved the average Newfoundland and Labrador family.  

The Furey gas tax cut has meaningfully impacted the lives of Newfoundland and Labrador families. But those families are in for a world of hurt if Furey doesn’t extend his tax cut past the end of March.  

The Furey government first cut the provincial gas tax in June 2022. The tax cut was introduced to help struggling families confront high gas prices and soaring inflation.  

The Furey tax cut lowered the tax burden at the gas pumps by 8.05 cents per litre. Over the past 18 months, the average two-car Newfoundland and Labrador family has saved more than $700.   

Thanks to Furey’s tax cut, gas taxes in Newfoundland and Labrador are the lowest in Atlantic Canada. The province’s gas tax is eight cents per litre lower than in Nova Scotia.  

Families are saving a bundle and have more cash in the bank to pay for groceries and little league. They might even have enough to begin replenishing a depleted rainy-day fund.   

As Newfoundlanders and Labradorians begin to get into the swing of things in 2024, the last thing they need is a massive gas tax hike. 

The reason Furey introduced the gas tax cut was to help struggling families. That is the exact reason why Furey should extend his gas tax cut past the end of March.  

Household debt in Canada has reached record levels. The scourge of inflation is not gone. And grocery prices are 10 per cent higher today than they were a year ago.  

Furey continues to talk a good game. In a year-end interview, Furey said his government’s cost-of-living relief measures, including the temporary gas tax cut, remain an important part of Newfoundland and Labrador’s plan to confront financial pressures for families. 

“These were not done as one-offs,” Furey said. “They were done strategically to capture as many people in Newfoundland and Labrador as we could, recognizing that every family is feeling the pressure.”  

Talk of relief measures not being one-offs is nice. But acting on those words and delivering more savings for taxpayers is what matters.  

Furey is not alone in recognizing the importance of lowering gas prices. Other governments have recently taken action to reduce gas taxes.  

Manitoba’s new premier, Wab Kinew, suspended his province’s gas tax Jan. 1, saving drivers 14 cents per litre at the pumps until the end of June. Ontario extended its temporary gas tax cut for another six months. Furey should follow the lead of Kinew and Ontario Premier Doug Ford.  

If Furey lets his gas tax cut expire, Newfoundlanders and Labradorians will be in for a double punch. Right now, the provincial gas tax cut is positioned to expire the very same day the Trudeau government plans to hike the federal carbon tax.  

Without action from the province, the combined impact of the end of the gas tax cut and the increase in the federal carbon tax would be a stunning 11.8 cents per litre. That would drive up the cost of filling up a minivan by nine dollars overnight. 

Furey has shown himself to be a friend to taxpayers in the past. While Prime Minister Justin Trudeau continues to hike his carbon tax every year, Furey has saved taxpayers more than $100 million through his offsetting provincial gas tax cut.  

But all that good work will be undone if Furey lets his tax cut lapse.    

If Furey wants to stay in the taxpayer good books in 2024, he needs to make sure his gas tax cut is here to stay.