Alberta gas tax to return in 2024

Alberta’s premier has reversed her spring 2023 decision to drop the province’s gas tax and is bringing it back at nine cents per litre in the new year.

It was previously removed to provide relief in the wake of the affordability crisis.

This tax is tied to the price of oil, and in the past, higher prices provided the province with enough revenue to drop the tax.

Current policy states Alberta won’t charge a gas tax if West Texas Intermediate (WTI) oil prices are above $90 per barrel.

Currently, WTI oil is sitting around $70 a barrel, meaning most of the tax will return to the price at the pumps.

With the suspension in place, families save about $70 per month, according to the Canadian Taxpayers Federation.

This week, NDP energy critic Kathleen Ganley spoke out against the decision, saying now is not the time to reverse cost-saving efforts.

Read more: Alberta extends fuel-tax pause through 2023

“In a province grappling with escalating rents, a housing affordability crisis, high grocery bills and rising power bills, the UCP [is] focused, not on how to help Alberta families, but how to help themselves,” she said. “While most Albertans are struggling to afford the basics, provincial coffers fill with oil revenues.

“The UCP need[s] to pay for the promises to create more cushy board jobs and fill them with their friends at increased salaries.”

But, the decision didn’t come without warning, as weeks ago, Premier Danielle Smith warned listeners of the change on her province-wide radio show and noted that even with the tax, Albertans will still be paying some of the lowest prices in Canada.

Concordia University economics professor Moshe Lander says Albertans can look to developments in the ongoing war in the Middle East to dictate future oil prices.

“If that war spills over and starts to drag in some of the major players, there’s a risk that if the Saudis or the Iranians get involved and start picking sides, that’s the type of thing that can be destabilizing to oil prices,” he explained.

Even more pain at the pumps could be ahead, as the federal government is raising the carbon tax to 17 cents per litre of gas and 21 cents per litre of diesel on April 1.

This increase is coming after weeks of considerably lower gas prices, with one station, the Costco in Tsuu’tina Nation, even dropping to 99.9 cents a litre.

Editor’s note: The year Alberta Premier Danielle Smith and the provincial government extended the provincial fuel tax was corrected to 2023 from 2022.