Ontario Premier Doug Ford will push ahead with an election promise to permanently cut the provincial gas tax by 5.7 cents per litre, despite the federal government’s reversal on the controversial carbon tax.
On Friday, Prime Minister Mark Carney signed an order-in-council removing the consumer fuel charge as of April 1 — a move that’s expected to reduce the price of gas in the province by roughly 17.6 cents per litre.
The end of the consumer carbon price was immediately hailed by Ford, who has railed against the tax since being elected in 2018.
“Good riddance to the worst tax ever,” Ford said on social media immediately after the Liberal government announced the change.
The application of the federal carbon tax in Ontario, however, was a direct result of the Ford government’s policy in 2018 to end the cap-and-trade program which saw Ontario industries participate in a credit purchase and swap system along with Quebec and California.
Revenues from cap-and-trade, $2.9 billion in total, were repurposed into green energy retrofit programs and electric vehicle rebates.
Once the program was eliminated and the federal carbon backstop kicked in, the Ford government unveiled a new $1 billion-a-year program to offer drivers a 5.7 cent per litre discount on fuel by cutting the provincial gas tax.
During the election campaign, the Progressive Conservatives promised to make the discount permanent — a policy the party says it will follow through on despite the change in Ottawa.
“Yes,” a spokesperson for Ford said when asked by Global News whether it would keep the gas tax cut in place in spite of the changes in Ottawa.
What the premier’s office was unclear on is how the government will treat the industrial price on carbon, which mirrors the federal charge.
In 2022, the government fully implemented the Emissions Performance Standards program — a carbon price that the province said would “encourage the industrial sector to reduce greenhouse gas emissions” and minimize the risk of production facilities leaving the province for other countries with “less stringent climate policies”
The industrial carbon price, which applies to the manufacturing, resource and electricity generation sectors, is set to rise to $170 per tonne of GHG emissions by 2031.
When asked whether the province had plans to alter or remove the industrial price on carbon emissions, the Ford’s office offered little clarity.
“In light of President Trump’s tariffs, all levels of government need to look for ways to lower costs, support people and businesses, and make us more economically competitive,” Grace Lee said in a statement.
The office did not respond to further questions.
Green Party MPP Aislinn Clancy questioned the government’s evasiveness.
“Sounds like they’re trying to avoid being clear on the issue, I think they want to be supportive of industry given the tariffs are threatening jobs,” Clancy said.
The government said the industrial carbon price has raised approximately $400 million during the first two years — money that’s largely reinvested in the companies that pay up.
“Ontario is reinvesting the compliance payments collected through the EPS from large industrial facilities to reduce greenhouse gas emissions at these facilities,” the Ministry of Environment told Global News in a statement. “This will also help these facilities stay competitive while supporting economic growth.”