Affordability tops Canadians’ concerns, yet the federal fuel tax returns Sept. 8

Prime Minister Mark Carney needs to look at this poll and understand something simple: People will not accept a gas tax hike in September.

New polling shows 63 per cent of Canadians oppose the federal government’s plan to hike fuel taxes next month.

Carney suspended the federal fuel tax in April to give Canadians a break at the pumps, saving 10 cents per litre of gas and four cents per litre of diesel.

The Canadian Taxpayers Federation pushed for gas tax cuts for decades because cutting taxes is the simplest, fastest and easiest way for governments to make life more affordable for everyday working people.

Federal fuel tax relief also makes life more affordable for all Canadians every time they buy anything trucked to store shelves, a point even the federal government acknowledges.

“Cutting the tax on gasoline and diesel,” according to the prime minister’s office, “will reduce operating costs for truckers and businesses in the food, agriculture, housing, construction and delivery sectors.”

Making it cheaper for truckers to deliver goods to the store makes it more affordable for Canadians to buy those goods once they get there.

But relief is about to disappear. Carney plans to crank the gas tax back up on Sept. 8, just as Canadians are driving their kids back to school.

Canadians don’t support the gas tax hike. Most Canadians across all demographics—gender, age, and province—oppose the increase, according to Leger polling. The demographics that typically support Carney’s Liberals, women and people 55 and older, are more likely to oppose the gas tax hike. Among Canadians who’ve made up their mind, 71 per cent oppose the gas tax hike.

The rising cost of living remains the dominant issue facing Canadians, according to recent analysis from Abacus Data. And whether Canada is in a recession or not, the state of the economy is a top concern for people. Cutting gas taxes helps on both fronts.

Cutting gas taxes lowers costs and that means “businesses can hire more workers, confidently build and export more products to global markets,” according to the PMO.

Eliminating the gas tax for a year would save a family fuelling up their minivan once a week more than $350. If that family has more than one vehicle or drives longer distances for work, the savings get even larger.

If Carney is serious about affordability, he shouldn’t stop at leaving the suspension in place. He should go further and permanently eliminate the gas tax.

Here’s how Carney can do that without ballooning the debt: Stop overspending.

The federal fuel tax brings in about $6 billion annually, according to a 2025 report from the Parliamentary Budget Officer. If Carney stuck to the spending numbers in his own budget, he could more than cover that.

In November, Carney’s budget said the government would spend $588.3 billion this year. Six months later, his budget update showed spending increasing to $594.8 billion—$6.5 billion over his own plan.

If Carney just stuck to his own budgeted spending, the government would have more than enough money to cut the gas tax for a full year without borrowing a cent more.

The cost of the federal bureaucracy is projected to increase by $10 billion this year, according to the PBO. And Ottawa spends about $11 billion annually on corporate subsidies.

Cutting spending in those three places alone would cover the cost of permanently scrapping the gas tax, with billions left over.

Carney has listened to Canadians before on unpopular tax hikes. After all, his government axed the consumer carbon tax the Liberals had charged for years, following widespread opposition from taxpayers.

Carney should again listen to the clear majority of Canadians and cancel his September gas tax hike.

Franco Terrazzano is the Federal Director of the Canadian Taxpayers Federation and a public policy analyst specializing in government accountability, taxation, and fiscal waste. He holds a Master of Public Policy and a Bachelor of Arts in Economics from the University of Calgary.