Manitoba introduces bill to temporarily lift provincial tax on fuel

WINNIPEG -

The Manitoba government introduced a bill Thursday to suspend the province's fuel tax for six months, and possibly longer.

If the bill is passed into law, it would lift the 14-cent-a-litre tax on gas, diesel and natural gas used in vehicles between Jan. 1 and June 30. It would also give cabinet the power to extend the tax holiday, perhaps at a reduced rate, for another six months.

"We know that working-class people across this province drive a lot," Finance Minister Adrien Sala said Thursday.

"This legislation will help everyday Manitobans. We're confident about that."

The tax cut was promised by the NDP during the recent election campaign and is aimed at helping people with the rising cost of living. The average family with two vehicles would save $250 over the six-month period, Sala said.

The tax cut has faced criticism from some environmentalists and others, who say it primarily benefits people with large gas-guzzling vehicles and does not encourage people to reduce emissions.

Liberal legislature member Cindy Lamoureux said the tax cut does nothing for many low-income earners.

"That's only going to help those who can afford to put gas in their cars," Lamoureux said earlier this week.

There is no mechanism to ensure that oil companies will not raise prices and take up some of the room created by the tax cut, but Sala said he is confident motorists will see the full savings at the pumps.

"What we know from other jurisdictions where this type of legislation has passed is that these savings are passed on to consumers," Sala said.

The Alberta government suspended its fuel tax on gasoline and diesel at the beginning of 2023, and the tax suspension is scheduled to last to the end of the year.

The Manitoba tax cut will mean the province will forego an estimated $163 million in revenue over the six months.

The NDP government is hoping to have the bill passed by the legislature before the winter break starts on Dec. 7. The Opposition Progressive Conservatives said Thursday they were still studying the bill and would comment later.

   This report by The Canadian Press was first published Nov. 23, 2023