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Canada to extend federal gas tax holiday into the new year

newsSep 2, 20261252

The federal government will extend the temporary pause of the federal fuel excise tax on gasoline and diesel until Jan. 31, 2027, Finance Minister François-Philippe Champagne is expected to announce in Ottawa. The pause began in April to address volatile oil prices after the U.S.-Iran war and had been scheduled to expire on Labour Day. The suspension cuts the cost of regular gasoline by 10 cents per litre and diesel by four cents per litre, the government said in April. Sources say the measure will be gradually lifted in spring so the excise tax returns in stages rather than all at once. The Canadian Automobile Association reported the national average price of gas at 172.9 cents per litre as of Wednesday morning. Conservative Leader Pierre Poilievre urged a broader rollback, asking Prime Minister Mark Carney to remove all taxes on gas until at least Canada Day 2027 and to eliminate the GST on fuel plus certain climate regulations and carbon levies. Ontario Premier Doug Ford had also pushed for an extension at least through the end of the year to counter tariff and price pressures.

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