Manitoba extends gas tax holiday to end of 2024

The Manitoba government is once again extending its temporary fuel tax breakbythree months.

It will now remain in place until the end of the year, Premier Wab Kinew announced Wednesday.

The NDPpromised during its election campaign in 2023 to temporarily cut the 14-cents-per-litre provincial fuel taxas a way to help people with rising costs due to inflation.

The tax break came into effect on Jan. 1 and was initially supposed to last six months, to the end of June.Kinewlater extended the reprieve by three months, until the end of September.

People who drive the most popular type of vehicle in the province, a pickup truck, save around $14 per fill with the tax break, Kinew said in a news release.

Since the start of the year,inflation in Manitoba has dropped to within the Bank of Canada's target range of one to three per cent, and the Manitoba Bureau of Statistics estimates the fuel tax reliefhas directly contributed a0.4 percentage point decrease in that rate, the government's release states.

Shiu-Yik Au,an associateprofessor of finance at the University of Manitoba's Asper School of Business, said the government considers the gas tax holiday worth it, even if itmeans less money in the province's coffers.

"From a political standpoint, WabKinew is the most popular premier in all of Canada," said Au, referring toAngus Reid polling, "and he's a savvy politician who knows what people like."

However, thegovernment is forgoing approximately $340 million this year because it isn't charging a gas tax in 2024 and theprovince, which usually records deficits every year,isn't flush with money.

"There will be a day when the piper needs to be paid," said Au. "The question is howwhether or not it'll be through other tax increases or through cuts to social services."

Kinew hinted a month ago that fiscal restraint is coming, as his NDP government, elected last fall, tries to fulfil its promises to restore public services while also balancing the budget within its first term in office.

Loss of 'important source of revenue': CCPA

The Canadian Taxpayers Federation applauded the move Wednesday, but called for the tax break to be made permanent, saying Manitobans shouldn't have to worryabout the price jumping at the end of every extension.

A permanentcut would mean guaranteed savings for Manitobans every year, said Gage Haubrich, the organization'sPrairie director, in a news release.

Manitoba's fuel prices have been thelowestin the country sinceJan. 1. According to the CTF's analysis, that would have saved a family filling a minivan and pickup truck once every two weeks $440 so far.

Thelatest three-month extension means that same Manitoba family will save about $147 more, said Haubrich.

But Molly McCracken, the Manitoba director with the Canadian Centre for Policy Alternatives, said she's concerned about the extension.

"It's an important source of revenue for Manitoba, and it's not being replaced by another source," she said.

The province needs the money it's giving up to deal with pressing problemslikethe climate crisis, McCracken said.

"They've also said they're going to improve health care and balance the budget," she said. "Those don't all line up, so something's going to have to give."

Meanwhile, interim Progressive Conservative Leader Wayne Ewaskoaccused Kinew of"stringing Manitobans along three months at a time" with"short-term fixes to dodge accountability and distract from negative headlines."

Manitobans need "meaningful, long-term relief to support their families," he said in a written statement.

But oneWinnipegger CBC spoke with about the extension said it feels like an earlyChristmas gift.

WATCH | 'It's like a Christmas gift,' says driver:

Manitoba tanks gas tax for remainder of 2024

1 day ago

Duration 1:56

The gas tax holiday will now last the entirety of the year, after the provincial government announced Wednesday it would extend the relief at the pumps for another three months.

Noel Lyawe, who drives his kids to school and himself to work, said getting somerelief at the pump helps given the current cost of living.

"No matter how small, it shows that [the government] is considerate," he said.

Annastacie Barrow saidWednesday wasthe first time she had heard about the tax break.

She said it doesn't impact her directly because she doesn't drive, but thinks her boyfriend will be happy about the news.

"He's a roofer, so at least he can get a little bit further with the more gas that he gets," she said.

Corey Rempel said he doesn't pay much attention to the gas tax, because when someone needs to fill up their vehicle, he doesn't think many can wait until prices go down.

Others might be more strategic whenit comes to watching gas prices, he said, but whenthe weather is nice, he can findother ways to get around instead of using a car.

"Regardless of what the cost is going to be, you still need to get around and do what you have to do," he said.