Motor fuel taxes in Canada
In Canada, motor vehicles are primarily powered by gasoline or diesel fuel. Other energy sources include ethanol, biodiesel, propane, compressed natural gas (CNG), electric batteries charged from an external source, and hydrogen. Canada, like most countries, has excise taxes and other taxes on gasoline, diesel, and other liquid and gas motor fuels (collectively called fuel taxes), and also taxes electricity at various administrative levels. Most provinces and territories in Canada also have taxes on these motor fuels, and some metropolitan areas such as Montreal, Greater Vancouver, and Victoria impose additional taxes.
Additionally, Canada's federal (national) government collects value-added tax (GST) across the country, and some provincial governments also collect a provincial sales tax (PST), which may be combined with the GST into a single harmonized sales tax (HST). HST, GST, or GST + PST where applicable, are calculated on the retail price including the excise taxes.[1]
Across Canada, motor fuel taxes can vary greatly between locales. On average, about one-third of the total price of gasoline at the pump is tax. Total minimum taxes (taxes before GST/HST/PST is added at the retail level, but including GST/HST/PST on the excise taxes themselves) vary from 17.0¢/litre (64.4¢/US gallon) in the Yukon to 41.01¢/L ($1.552/US gallon) in Greater Vancouver.
Gasoline tax rates across Canada
| Government | Federal excise tax (CAD¢/L) | Prov/terr excise tax (CAD¢/L) | Local excise tax (CAD¢/L) | Total excise tax (CAD¢/L) | HST, GST, or GST + PST/QST (%) |
Minimum tax incl. sales taxes (CAD¢/L) |
Min. tax (CAD¢/US gal) |
|---|---|---|---|---|---|---|---|
| Canada (average) | 10 | 14.5 | 24.5 | - | 25.3 | 95.8 | |
| Newfoundland and Labrador | 10 | 33[nb 1] | 43 | 13% | 48.6 | 183.7 | |
| Prince Edward Island | 10 | 13.1[nb 2] | 23.1 | 14%[nb 3] | 26.3 | 102.2 | |
| Nova Scotia | 10 | 15.5 | 25.5 | 15% | 29.3 | 110.9 | |
| New Brunswick | 10 | 13.6 | 23.6 | 13% | 26.7 | 101.1 | |
| Quebec[nb 4] | 10 | 20.2 | 30.2 | 14.975% | 34.7 | 131.3 | |
| Ontario | 10 | 14.7 | 24.7 | 13% | 27.9 | 105.7 | |
| Manitoba | 10 | 14.0 | 24.0 | 5%[nb 5] | 25.2 | 95.4 | |
| Saskatchewan | 10 | 15.0 | 25.0 | 5%[nb 6] | 26.2 | 99.2 | |
| Alberta | 10 | 13.0 | 23.0 | 5% | 24.15 | 91.4 | |
| British Columbia[nb 7][2] | 10 | 21.17[nb 8][3] | 31.17 | 5%[nb 9] | 32.73 | 119.5 | |
| Yukon | 10 | 6.2 | 16.2 | 5% | 17 | 64.4 | |
| Northwest Territories | 10 | 10.7 | 20.7 | 5% | 21.7 | 82.1 | |
| Nunavut | 10 | 6.4 | 16.4 | 5% | 17.2 | 65.1 | |
| Montréal, QC | 10 | 20.2 | 3 | 33.2 | 14.975% | 38.2 | 144.6 |
| Vancouver, BC[2] | 10 | 15.17[nb 8][3] | 17.0 | 42.17 | 5%[nb 9] | 44.28 | 155.2 |
| Victoria, BC[2] | 10 | 21.17[nb 8][3] | 3.5 | 34.67 | 5%[nb 9] | 36.40 | 133.4 |
Notes:
- ↑ A reduced tax of 23¢/L applies in areas of Labrador close to the border with Quebec.
- ↑ On April 1, 2013 PEI changed its tax for gasoline to a fixed rate of 13.1¢/L. Prior to this, from 2005 to 2013, the fuel tax was adjusted monthly as a blended tax based on volume and included an amount equivalent to PEI's Provincial Sales Tax. The pre-April 1, 2013 fuel tax was capped at 15.8¢/L.
- ↑ PEI introduced a 14% Harmonized Sales Tax (HST) on April 1, 2013 which applies to all fuel purchases. Prior to April 1, 2013, the Provincial Sales Tax of 10% did not apply to fuel.
- ↑ Excluding Montreal.
- ↑ Manitoba's PST does not apply to gasoline or diesel fuel.
- ↑ Saskatchewan's PST does not apply to gasoline or diesel fuel.
- ↑ Excluding Vancouver and Victoria.
- 1 2 3 Includes carbon tax of 5.56 ¢/L as of July 1, 2011 (scheduled to rise to 6.67 ¢/L on July 1, 2012).
- 1 2 3 HST of 12% applies to gasoline and diesel fuel, but the 7% provincial portion is refunded at the point of sale. However, the full 12% is charged on propane (whether for a vehicle or not) and for diesel fuel marketed as home heating fuel.
Diesel fuel tax rates across Canada
| Government | Federal excise tax (CAD¢/L) | Prov/terr excise tax (CAD¢/L) | Local excise tax (CAD¢/L) | Total excise tax (CAD¢/L) | HST, GST, or GST + PST/QST (%) |
Minimum tax incl. sales taxes (CAD¢/L) |
Min. tax (CAD¢/US gal) |
|---|---|---|---|---|---|---|---|
| Newfoundland and Labrador | 4 | 16.5 | 20.5 | 13% | 23.2 | 87.7 | |
| Prince Edward Island | 4 | 20.2 | 24.2 | 5% | 25.4 | 96.2 | |
| Nova Scotia | 4 | 15.4 | 19.4 | 15% | 22.3 | 84.5 | |
| New Brunswick | 4 | 21.5 | 25.5 | 13% | 28.8 | 109.1 | |
| Québec | 4 | 20.2 | 24.2 | 14.975% | 27.8 | 105.4 | |
| Ontario | 4 | 14.3 | 18.3 | 13% | 20.7 | 78.3 | |
| Manitoba | 4 | 11.5 | 15.5 | 5% | 16.3 | 61.6 | |
| Saskatchewan | 4 | 15.0 | 19.0 | 5% | 20.0 | 75.5 | |
| Alberta | 4 | 13.0[4] | 13.0 | 5% | 13.7 | 51.7 | |
| British Columbia | 4 | 21.39 | 25.39 | 5% | 26.66 | 100.9 | |
| Yukon | 4 | 7.2 | 11.2 | 5% | 11.8 | 44.5 | |
| Northwest Territories | 4 | 9.1 | 13.1 | 5% | 13.8 | 52.1 | |
| Nunavut | 4 | 9.1/3.1 | 13.1/7.1 | 5% | 13.8/7.5 | 52.1/28.4 | |
| Vancouver, BC | 4 | 21.39 | 9 | 34.39 | 5% | 36.11 | 136.7 |
| Victoria, BC | 4 | 21.39 | 3.5 | 28.89 | 5% | 30.33 | 114.8 |
Tax revenues
The Government of Canada collects about $5 billion per year in excise taxes on gasoline, diesel, and aviation fuel[5] as well as approximately $1.6 billion per year from GST revenues on gasoline and diesel (net of input tax credits). The Canada Revenue Agency, a part of the government, collects these taxes.
Collectively, the provincial governments collect approximately $8 billion per year from excise taxes on gasoline and diesel.
The federal taxes go into general coffers and help to fund a range of programs: $2 billion of the approximately $5 billion collected from federal excise taxes goes into the now permanent annual Gas Tax Fund for municipal infrastructure. Provincial tax revenues usually go to fund road repair and construction, and additionally in some provinces a portion of revenues (for example, 2 cents/litre in Ontario) is also distributed directly to municipalities.[6]
See also
References
- ↑ "Oil and Gas Prices, Taxes and Consumers". Department of Finance (Canada). July 2006. pp. 6b) Application of the GST. Archived from the original on 2007-11-20. Retrieved 2007-12-13.
- 1 2 3 BC Ministry of Finance (July 2010). "Ministry of Finance Tax Bulletin: Tax Rates on Fuels: Clear Gasoline Tax Rates per Litre" (PDF). Retrieved 7 July 2010.
- 1 2 3 BC Ministry of Finance (n.d.). "How the Carbon Tax Works". Retrieved 5 July 2011.
- ↑ http://www.finance.alberta.ca/publications/tax_rebates/rates/hist1.html#fuel
- ↑ "ARCHIVED - BACKGROUNDER – OIL AND GAS PRICES, TAXES AND CONSUMERS". Department of Finance Canada. October 2005. Retrieved 7 February 2013.
- ↑ Ministry of Transportation. "Backgrounder - How municipalities benefit from provincial gas tax funding". Canada NewsWire. Government of Ontario, Canada. Retrieved 2007-09-07.