The government of Manitoba says it will be reinstating the fuel tax, but at a lower rate.
The province has been on a tax holiday for 12 months following the introduction of legislation in November 2023 to pause the fuel tax on gas, diesel, and home heating natural gas. The tax break was originally planned for six months, but was extended on Sept. 25 until Dec. 31.
Manitoba’s government has now said starting Jan. 1 the tax would be back in place on gas and diesel, but at 12.5 cents per litre. Prior to the pause, the tax was 14 cents per litre.
In November 2023, it was estimated the six-month pause would save two-vehicle families $250.
In September, when the gas tax holiday was extended, the government said that those who drive a pickup truck will save about $14 every time they fill up.
The province said the pause on the gas tax caused the provincial inflation rate to drop 0.4 percentage points.
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A Leger survey conducted between Nov. 22 and 24 found that the majority of residents supported the tax holiday extension, with 73 percent saying they backed the provincial government’s move. Of those, 50 percent said they strongly supported the decision while 23 percent said they somewhat supported it.
Seventeen percent of those surveyed said they opposed the government’s decision to pause the extension, with 10 percent saying they strongly opposed the measure.
The survey also found that 70 percent of respondents wanted to see the fuel tax gone for good, including 45 who strongly supported the idea of eliminating the tax and 25 who somewhat supported the idea. In this case, 19 percent said they were opposed to having the tax paused forever, with 11 percent saying they strongly opposed such a move.
The return of the fuel tax is not the only cost increase that Manitoba residents will see in the new year, according to the Canadian Taxpayers Federation (CTF).
In 2025, the province’s 50 percent school property tax rebate will be replaced with a $1,500 tax credit on principal homes, the CTF said.
It means that depending on the value of a home, some Manitoba residents could see an increase in property taxes.
Income taxes will also increase for those residents earning more than $200,000. The province announced it will phase out the basic personal amount for those earning between $200,000 and $400,000. The basic personal amount is how much residents are able to earn before they need to pay taxes.
Like other Canadians, Manitobans will also see some federal tax changes, including an increase in the carbon tax, which is set to increase to about 21 cents per litre of gas, 25 cents per litre for diesel, and 18 cents per cubic metre of natural gas. The increase is scheduled for April 1.
Federal taxes on alcohol will also increase by 2 percent on April 1.
The Canadian Press contributed to this report.
