Alberta Premier Danielle Smith said Monday the fuel tax relief program will be extended to the end of the year to make life more affordable for Albertans.
The program, which saves Albertans 13 cents per litre at the pumps, was set to expire at the end of this month, but the premier had promised during the last election campaign to extend it. The premier said freezing gas taxes for another six months will save an Alberta family $6 to $18 every time they fill up.
Since the program was announced in May 2022 by former UCP premier Jason Kenney Albertans have saved $1.5 billion at the pumps. The extension is expected to cost the government another $520 million in uncollected tax revenue.
Red Deer Polytechnic instructor Dustin Quirk doubts the government’s move will do much to make life more affordable for most Albertans.
“While everyone appreciates a tax break, this is more of a symbolic move that only marginally benefits individuals who drive gasoline-powered cars as 13 cents per litre is just a few dollars saved each fill-up,” said Quirk, who is an instructor at the Donald School of Business, Science and Computing.
“This fuel tax suspension does little to help with overall affordability for many individuals and families like seniors who no longer drive, many students and youth, or families that rely on public transit.”
While saving money at the pumps will be welcomed by most drivers, Quirk questions how the government will manage the impact of lost revenue at a time when there are calls for more funding for education and health, both high priorities for many Albertans.
“I am sure the move will prove popular, but one has to ask, would Red Deerians be better served by broader income tax relief to help with affordability or perhaps new schools, better-maintained highways, or an acceleration of the Red Deer Regional Hospital expansion that this foregone revenue could have supported.”
Smith said that although the West Texas Intermediate benchmark oil price has been below US$90 a barrel, Albertans continue to face affordability challenges due to inflation.
Finance Minister Nate Horner says extending the program is expected to cost $520 million, but the government is cautiously optimistic about Alberta’s economy.
The government is set to release its first-quarter report of the fiscal year at the end of August.
“There are a lot of things happening in Alberta’s economy that is good news of us,” Horner said at a news conference Monday.
“That’s why we are able to do this today.”
– With files from The Canadian Press