The federal government says legislation extending the suspension of the federal fuel excise tax has received royal assent.
Bill C-38, the Canadian Fuel Affordability Act, extends the temporary suspension until Jan. 31, 2027. The Department of Finance says Canadians will continue to save more than $5 each time they fill a typical 50-litre tank of gasoline while the full relief is in place.
From Feb. 1, 2027, to March 31, 2027, excise tax rates will be restored at 50 per cent of their regular levels. They will return to full levels on April 1, 2027.
The tax was suspended on April 20, 2026. The suspension saves 10 cents per litre on gasoline and unleaded aviation gasoline, 11 cents per litre on leaded aviation gasoline and four cents per litre on diesel and aviation fuel. The government says gasoline prices fell by 11 cents per litre on the first day.
The department says the extension is expected to deliver an additional $2.9 billion in relief, raising total estimated fuel tax savings to $5.3 billion in 2026-27. It cited global instability and ongoing supply disruptions in the Middle East as pressures on energy markets.
“By extending this tax relief, we are helping Canadians keep more of their hard-earned money, lowering transportation costs for businesses, and helping protect our economy from global disruptions,” said Finance Minister François-Philippe Champagne. “This is about making life more affordable and keeping our economy moving in a more uncertain world.”
