New Brunswick has been given the OK to keep a past reduction to its provincial gas tax, as long as the government keeps quiet about why it was introduced and how it was funded.
Under updated federal carbon pricing rules that take effect next year, provinces aren’t allowed to cut provincial gas taxes to blunt the impact of increases to the carbon price.
That’s to avoid diluting what the federal government calls the “price signal,” which is intended to push consumers to cheaper and cleaner alternatives.
But in 2020, New Brunswick did exactly that, with a 4.4-cent-per-litre cut to the provincial tax, softening the blow to consumers. In his 2020 budget speech, Finance Minister Ernie Steeves said the province would be “protecting consumers” by ensuring they only saw a 2.2-cent-per-litre jump in prices at the pump.