‘It’s too expensive now’: Calls for domestic fuel tax relief as Europe, Australia act

Canadians are feeling the pinch as the global conflict in the Middle East and seasonal changes prompt rising gas prices. John Vennavally-Rao reports.

TORONTO — Will Hueyen says normally, $50 is enough to fill the tank of his compact car. But as he fuelled up at a downtown Toronto gas station Monday afternoon, he said it now costs more than that, and it hurts.

“It’s too expensive. I don’t like it,” Hueyen said. “I plan to change to an electric car now.”

With prices at $1.72 per litre – and much higher in some Canadian cities – he isn’t alone in his frustration.

“We have nothing to do with the war, but we’re paying for it,” said another motorist as he refuelled. “It’s painful.”

As the war in Iran enters its fifth week, the effective closure of the Strait of Hormuz has sent global oil prices soaring, leaving Canadian motorists to endure higher costs at the pump.

Pressure mounts for tax relief

The Canadian Taxpayers Federation (CTF) is renewing calls for federal and provincial governments to provide relief.

“The least they could do would be just temporarily suspend their fuel taxes,” said Franco Terrazzano, federal director of the CTF. Ideally, he’d like to see those tax cuts be permanent.

According to the group, total taxes on gasoline – including federal excise taxes, provincial levies and GST – can reach nearly 65 cents per litre in some Canadian cities.

“There are many Canadians out there who were already struggling, and now that you see these gas prices soaring, it’s making life more expensive,” he said.

International response

While Canada has maintained its current tax structure, other nations are moving to insulate citizens from some of the price shock:

• Italy: The government implemented emergency tax-relief measures, including a 20-day cut to consumer fuel taxes, and offered tax credits to truckers to offset higher diesel costs.
• Spain, Ireland, and Portugal: All have introduced temporary tax reductions on fuel.
• Australia: The federal government has slashed fuel and diesel taxes by half for three months. The states of Victoria and Tasmania have made public transit free to reduce demand at the pump.

“We understand the cost pressures for people are very real,” Australian Prime Minister Anthony Albanese said of his country’s intervention.

Ottawa remains non-committal

When asked if Canada would follow the lead of Australia or Italy, federal Finance Minister François-Philippe Champagne stopped short of promising tax relief.

Champagne said the government is “following the situation very carefully,” noting that Canada is working with international partners to boost the global oil supply. He pointed to the recent release of strategic petroleum reserves and an increase in domestic oil production as levers currently being used to stabilize the market.

Terrazzano believes the government should do more.

“Canadians need help. Canadians need tax relief. We need the federal government and provincial governments to step up, make life more affordable and cut taxes.