Alberta to extend gas tax cut; electricity rebate expected for July

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The Government of Alberta will be extending its gas tax relief initiative for at least another three months, Premier Jason Kenney announced in a Wednesday news release.

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Alberta will not collect its standard 13 cents per litre tax at fuel pumps until at least September as crude oil prices remain high amidst soaring demand and Russia’s continued invasion of Ukraine. Kenney first introduced the relief measure in April and committed to reviewing the program every quarter.

“We’re helping Albertans save money through the fuel tax relief program at a time of need. While fuel prices have continued to increase nationwide, Albertans still pay considerably less than their provincial neighbours. We’re pleased to extend this important relief measure until the end of September,” Kenney said in the news release.

The government said drivers of compact cars will save about $6.80 when filling up while small SUV drivers will save about $7.21 and large pickups will cost about $18.50 less to fill up.

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Finance Minister Jason Nixon said countless Albertans have told the government that times are tough financially and that having a break at the pumps has been helpful.

“With the program’s extension, Alberta’s government is continuing to support Albertans and their ability to afford everyday goods,” said Nixon.

The tax relief has been tied to the price of West Texas Intermediate crude oil prices, with government officials previously stating that the tax would be reintroduced if WTI started trading below $90 a barrel. It was trading around $106 per barrel as of Wednesday afternoon.

While announcing the extension, Alberta continued to call on the federal government to institute similar reliefs by cutting their taxes, such as the carbon tax. The government will next evaluate the program in September.

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The extension comes as gas prices across Canada have helped to fuel the largest rise in inflation in the past four decades over the last month.

Nationally, customers paid 48 per cent more at the pump than a year earlier as a result of high crude oil prices last month. The cost of consumer items as a whole rose 7.7 per cent last month compared with a year ago, its largest increase since January 1983 when it gained 8.2 per cent, StatCan said.

Meanwhile, Alberta’s associate minister of natural gas and electricity announced long-awaited electricity rebates will arrive in July. A government news release stated nearly two million homes, farms and small businesses will receive $50 credits on their July, August and September bills.

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“We are providing targeted support to help hard-working Albertans deal with the rising cost of living. These rebates, combined with the fuel tax exemption and upcoming natural gas rebate, will help the large majority of Alberta households pay their bills,” said Dale Nally.

The government’s natural gas protections, first announced ahead of the 2022 budget, are still set to be introduced in October. That program will see Albertans protected from any price spike over $6.50 per gigajoule from October until April 2023. Numbers from several providers show prices have exceeded that threshold in recent months.

— With files from Canadian Press

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