N.L. bill would zero gas tax Dec. 1, with oil-price trigger

Newfoundland and Labrador’s provincial gas tax would fall to zero on Dec. 1 and stay off for as long as oil prices remain high, under a bill introduced Thursday in the House of Assembly in St. John’s.

The Progressive Conservative government announced Oct. 26 that the provincial tax on gasoline and diesel will be zero cents a litre from Dec. 1, 2026, to March 31, 2027, according to a news release from the Department of Finance. The government said the tax is currently 7.5 cents a litre on gasoline and 9.5 cents on diesel, CBC News reported.

The bill adds a quarterly review. Before each calendar quarter, on Dec. 16, March 16, June 16 and Sept. 16, the government will look at a 20-day average of Brent crude spot prices in U.S. dollars. That price decides whether the tax is applied at the pump, CBC News reported.

The threshold will be set in regulations and starts at US$89 a barrel. “So if that [oil price] stays high, above that, then we keep this gas tax off,” Premier Tony Wakeham told reporters outside the legislature.

Finance Minister Craig Pardy said the review dates reflect the time the Public Utilities Board needs to work through any change. He said the government looked at Alberta’s approach, which uses a benchmark of US$90 tied to West Texas Intermediate.

The government has put the cost of the cut at $25 million in additional relief. It says the measure builds on $54 million announced last week, including an accelerated Churchill Falls electricity rebate and a larger Home Heating Supplement, for $79 million in new cost-of-living help.

Liberal Leader John Hogan said an end to the provincial gas tax should have come long ago and that the tax should come off permanently. He said the plan gives residents no certainty, because the tax could return if oil prices fall.

The change affects drivers across the province, not only in the St. John’s area. Other governments are also moving on fuel costs. Ottawa recently extended its federal fuel excise tax relief, and our guide to energy bill grants by province lists other help with household costs.

The bill still has to pass the House before the Dec. 1 start date.

If you find reporting like this useful, consider supporting Canada News Media, an independent Canadian newsroom with no corporate parent.