The global landscape is rapidly changing.
In response, Canada’s new government is focused on what we can control – building a stronger, more independent, more resilient economy. We’re building an economy where Canadians are empowered with greater security, certainty, and a lower cost of living.
Global conflict and ongoing supply disruptions in the Middle East are driving up fuel prices around the world. To make Canada more energy secure and less reliant on external factors, our government is advancing major projects to realise Canada’s full potential in clean and conventional energy.
On April 14th, the Prime Minister, Mark Carney, announced that the government is temporarily suspending the federal Fuel Excise Tax on gasoline and diesel across Canada.
Started on April 20, 2026, Canada’s government will suspend the full amount of the tax on gasoline and diesel until September 7, 2026.
This is expected to reduce Canadians’ bills at the gas station by 10 cents per litre on regular gasoline and 4 cents on diesel.
The government is also temporarily suspending the federal Fuel Excise Tax on aviation fuels.
Cutting the tax on gasoline and diesel until Labour Day is a measure that will reduce operating costs for truckers and businesses in the food, agriculture, housing, construction, and delivery sectors.
The announcement builds on major initiatives to lower costs for Canadians, including:
Cutting taxes for 22 million middle-class Canadians by lowering the first marginal personal income tax rate from 15% to 14% as of July 1, 2025, providing tax relief of up to $420 a year per person, or up to $840 a year for two-income family
Cancelling the federal consumer carbon tax effective April 1, 2025, directly helping Canadians save money at the pump.
The government also removed the requirement for provinces and territories to have a consumer-facing carbon price as of that date. This has helped reduce gas prices in most provinces and territories by up to 18 cents per litre in comparison to 2024-25, lowering headline inflation.
Launching the new Canada Groceries and Essentials Benefit, which provides a family of four up to $1,890 this year, and about $1,400 a year for the next four years; and a single person up to $950 this year, and about $700 a year for the next four years. The benefit will provide additional, significant support for more than 12 million Canadians.
Budget 2025 also outlined concrete action to ensure Canadians receive the support they deserve, including targeted measures to strengthen food security and household affordability:
Making the National School Food Program permanent, providing school meals for up to 400,000 children each year, saving participating families with two children in school an estimated $800 annually on groceries.
Introducing Automatic Federal Benefits, starting in the 2026 tax year, to ensure up to 5.5 million low-income Canadians automatically receive the benefits they qualify for by the 2028 tax year, including the Canada Groceries and Essentials Benefit and the Canada Child Benefit.
Lowering costs and strengthening competition in essential services, including ambitious pro-competition measures in the telecom and financial sectors to reduce prices, make it easier for Canadians to switch providers, and lower banking and service fees..
Eliminating the Goods and Services Tax (GST) for first-time homebuyers on new homes up to $1 million and reducing the GST for first-time home buyers on new homes between $1 million and $1.5 million, to immediately make the goal of home ownership a reality for more Canadians, especially young families.
Cancelling the federal consumer carbon tax effective April 1, 2025, directly helping Canadians save money at the pump. The government also removed the requirement for provinces and territories to have a consumer-facing carbon price as of that date. This has helped reduce gas prices in most provinces and territories by up to 18 cents per litre in comparison to 2024-25, lowering headline inflation.