Alberta to partially reinstate provincial fuel tax, finance minister says
CBC
Albertans' provincial tax holiday at the gas pumps is fading with the summer weather.
The provincial government eliminated the provincial 13 cent-per-litre tax on April 1 after oil prices began to balloon and consumers grappled with inflation. Now relaxed oil prices have prompted Alberta to partly reinstate the provincial fuel tax starting Oct. 1, Finance Minister Jason Nixon told CBC News on Thursday.
For the next three months, the provincial government will collect a tax of 4.5 cents per litre on gas and diesel.
"It will result in 8.5 cents being saved on every litre of gas and diesel for Albertans going forward, and we'll continue to build on the fuel tax program," Nixon said.
The program should have saved consumers around $650 million in its first six months, he said.
The government said it would review the policy quarterly and look at the price of oil when deciding whether to continue the relief program.
The 4.5-cent tax will funnel about $30 million per month to provincial coffers, Nixon said.
He says the finance department is drafting legislation to make the provincial gas tax relief program permanent. However, whether such a bill ever hits the legislative chamber depends on the next premier, he said.
Nixon said the government looked at the closing price of benchmark oil West Texas Intermediate each day between Aug. 15 and Sept. 15 to decide how much relief would come to the pumps this quarter.
The temporary program works by adjusting the gas tax depending on the price per barrel.
The province eliminates the gas tax if the average oil price is higher than $90 US per barrel. A price between $85 and $89.99 US per barrel would lead to a fuel tax of 4.5 cents per litre. If the price is between $80 and $84 US per barrel, the fuel tax will rise to 9 cents per litre. If the price falls below $80 US, the government will fully reinstate the provincial 13-cent tax.
Nixon said Statistics Canada has pointed to the tax relief program as a significant factor in controlling inflation in Alberta.
"That really confirmed for us the need to continue forward," he said.
People buying marked fuels will continue to enjoy a provincial tax holiday for now, Nixon said.
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