Conservatives propose eliminating tax on diesel sales until Canada Day

Conservative Party Leader Pierre Poilievre is proposing to eliminate federal taxes on diesel fuel sales until Canada Day as a means to ensure affordable supplies of the fuel in the future. Canada currently produces enough diesel to meet national demand, but transportation bottlenecks cause some regions to rely on U.S. imports. In April, Ottawa suspended the federal fuel excise tax temporarily as global fuel prices surged, extending the suspension through January. The tax will be reduced to 50% of the regular rate from February to March 31, 2027.

Poilievre suggests removing the entire fuel excise tax until at least Canada Day by extending the cut until July 1, 2027, and eliminating the Goods and Services Tax (GST) on fuel purchases. He argues that higher taxes on diesel increase costs, which are ultimately passed on to consumers like farmers and truckers. Poilievre advocates for energy independence and reducing the price burden on Canadian families.

The Conservatives also propose scrapping the federal industrial carbon tax and the Clean Fuel Standard, claiming they add costs to diesel production and discourage refinery investment. They want refineries to be exempt from the federal impact assessment process, while still adhering to pollution, wastewater, leak, and monitoring regulations, as well as provincial environmental laws and permits.

Proponents claim the plan would boost refining capacity, improve Canadian crude processing, and develop necessary transportation and storage infrastructure to serve all regions.

Poilievre's office did not immediately respond to a request for comment on his proposals. He emphasized that the focus should be on affordability, stating that affordable fuel is crucial to combating poverty, supporting the middle class, and making Canada self-reliant. He expressed no intention to phase out Canadian oil and gas but rather to produce more of it at a lower price.