Big Savings at the Pump Ahead as Carbon Tax Ends for P.E.I. Fuel

The Island Regulatory and Appeals Commission has confirmed that the carbon tax applied to consumer fuel prices in Prince Edward Island (P.E.I.) will be removed starting next month, April 1.

Projected Savings for Motorists

Beginning on April 1, fuel prices on P.E.I. will reduce by approximately 20 cents per litre for gasoline and 24 cents for diesel. This significant change follows an order in council signed by Prime Minister Mark Carney shortly after his inauguration. As a result, consumers can expect lower prices at the pump.

Details on the Tax and Rebates

The current carbon tax contributes an additional 17.6 cents per litre for gasoline and 21.4 cents for diesel. However, because the Harmonized Sales Tax (HST) is also levied on this carbon tax, the overall savings will be slightly elevated, reaching around 20 cents for gasoline and 24 cents for diesel at the time of the change.

Despite the elimination of the consumer carbon tax, Canadian residents will still receive a carbon rebate for the month of April.

Background on Carbon Tax Implementation

The carbon pricing system was initially introduced in 2019 by former Prime Minister Justin Trudeau. This policy was aimed at encouraging individuals and businesses to reduce their fossil fuel use and transition towards more sustainable energy sources, contributing to Canada’s emissions reduction goals.

Over time, as Canadians faced rising inflation, the appeal of Conservative Leader Pierre Poilievre’s commitment to eliminate the tax grew among voters. In response to public concerns, rebates were provided to residents living in provinces where the carbon tax was applied.

It is important to note that this change does not affect home heating oil, which remains exempt from the carbon tax following a controversial decision made by Ottawa a year and a half ago.

savings, carbon, gas