COLUMN: Carney Suspends the Gas Tax—The Poisoned Gift You’ll Pay for Twice

Who Pays When the Government Stops Collecting

Let’s break down the mechanism with an accountant’s cold logic. The federal excise tax on gasoline brings in about 5.5 billion dollars a year for the federal government. Each month of suspension therefore represents about 460 million dollars in lost revenue. This money doesn’t disappear. It’s simply transferred from the “revenue” line item to the “future debt” line item.

Debt that will be repaid by the very same families who are cheering today over their $9 in savings. With interest. Interest on Canada’s federal debt already costs more than $54 billion a year—more than health care transfers to the provinces. Every billion added to the deficit today becomes thirty years of interest payments tomorrow.

The Illusion of “Savings” for the Middle Class

Let’s do the math that no one is doing on TV. The average Canadian household consumes about 1,500 liters of gas per year. At a savings of 15 cents per liter, that amounts to $225 per year. That’s $18.75 per month. That’s 62 cents per day.

Sixty-two cents. The price of Canadian fiscal democracy in 2025 is sixty-two cents a day per family. And for those sixty-two cents, an unelected government is mortgaging billions.

The Gap Between the Price per Barrel and the Price at the Pump

There’s an open secret in the Canadian oil industry that every energy minister knows but none has ever had the courage to address: refining margins. Between the price of a barrel of crude on international markets and the price posted at your gas station, there’s a chasm that no one explains to you. Gross refining margins in Canada have more than doubled since 2019, sometimes rising from 15 to 40 cents per liter.

When the price of crude oil falls, the price at the pump drops slowly. When crude oil rises, the price at the pump skyrockets within hours. This is what economists call the “rockets and feathers” effect—rockets on the way up, feathers on the way down. And it’s legal. And it’s unregulated. And it’s the real rip-off that Canadian motorists are facing.

Why Carney Is Looking the Other Way

Mark Carney is a former governor of the Bank of Canada. A former governor of the Bank of England. A man who navigated the 2008 financial crisis with a surgical understanding of market mechanisms. He knows that refining margins are the problem. He knows that market concentration—five major companies control more than 75% of the country’s refining capacity—creates a de facto oligopoly.

But regulating refining margins means declaring war on the oil industry. It means losing donors. It means alienating Alberta. It means accepting being called a socialist by the National Post’s editorial writers for six months. Whereas suspending a tax means smiling for the cameras and saying, “I’ve heard you.”

The Climate Paradox of a Green Government

Here’s the most biting irony of this announcement. For a decade, the Liberal Party of Canada has presented itself as the party of the climate. Carbon pricing—the infamous carbon tax—was touted as the cornerstone of Canadian environmental policy. The mechanism was simple and, economically speaking, defensible: make carbon more expensive to encourage the transition.

And now, that same party is making gas cheaper. The message sent to Canadians is blindingly clear: drive more. Use more fuel. Elections matter more than the planet.

Double-speak as the art of governing

Don’t look for consistency. There isn’t any. There’s an election calendar. Mark Carney must call an election in the coming weeks or months. Every day without an election is a day when the polls can swing the other way. Every announcement is calibrated not to solve a problem, but to buy time, sympathy, and momentum.

And yet, somewhere in the offices of Environment Canada, civil servants who have spent years modeling the effects of carbon pricing are watching this announcement and realizing that all their work has just been thrown into a political trash can.

The Invisible Geography of Fuel Dependence

This measure does not affect all Canadians equally, and that is precisely what makes it politically brilliant and socially unjust. A Montreal resident who takes the metro will save nothing. A worker in Fort McMurray who drives an F-150 with a 136-liter tank will save $20 per fill-up.

The suspension of the gas tax is, by its very nature, a transfer of wealth from urban to rural and suburban residents. From public transit users to SUV owners. From the poorest—who often don’t own a car—to the motorized middle class.

The deafening silence of the cities

Where are the mayors? Where is Valérie Plante? Where is Olivia Chow? The gasoline excise tax feeds the federal Gasoline Tax Fund, which transfers $2.4 billion annually to municipalities for infrastructure. Suspending the tax means suspending that transfer. It’s telling cities: your roads will have to wait. Your bridges will have to wait. Your buses will have to wait.

But the mayors are staying silent. Because criticizing a price cut, in the current political climate, is political suicide. No one wants to be the one to tell families that their nine dollars a week was a miscalculation.

The Perfectly Set Conservative Trap

Pierre Poilievre doesn’t even need to speak. All he has to do is smile. Because this announcement validates everything he’s been saying for the past two years: that gas taxes are a burden. That the government takes too much. That the solution is always to cut spending. Carney has just handed him, on a silver platter, proof that even the Liberals think their own taxes are excessive.

And when the suspension ends—because it will end; “temporary” always means “until the media forgets”—Poilievre will be there to say, “Why reinstate it? They’ve just admitted that you’re paying too much.”

The Impossible Turnback

It’s the iron law of temporary tax cuts: they’re never really temporary. Trudeau’s “GST Holiday” was supposed to last two months. The suspension of the carbon tax on home heating oil in the Atlantic provinces was supposed to be temporary. Every time, the politician who tries to reinstate the tax hits the same wall: “You’re raising my taxes.” ” No. I’m just restoring what was there before. But the human brain doesn’t work that way. A loss weighs twice as heavily as an equivalent gain. It’s the loss aversion bias, and every politician knows it.

Carney has just established a political floor below which no future government—Liberal or Conservative—will be able to go without paying an exorbitant electoral price.

When Ottawa Copies Washington Without Admitting It

Across the border, Donald Trump did exactly the same thing. He promised cheaper gas. He blamed taxes. He ignored market structures. He won elections. Oil populism knows no borders: it works just as well in Alberta as it does in Alabama, and just as well in Ontario as it does in Ohio.

The difference is that Trump is open about his contempt for climate policy. Carney, on the other hand, still pretends to believe in it. He wears the green pin on his lapel while signing the executive order that makes gas cheaper. The word for that in politics isn’t “pragmatism.” It’s cynicism.

The Trade War as a Universal Excuse

The announcement is, of course, framed by the context of the tariff war with the United States. Trump’s tariffs on Canadian goods, Ottawa’s retaliatory measures, economic uncertainty—all of this creates the perfect smokescreen to justify any populist measure. “Times are tough, families are suffering, we’re taking action.” That line has worked for any policy, in any context, since the dawn of time.

But Trump’s tariffs have nothing to do with gas prices in Canada. Canada is a net oil producer. The price of Canadian crude—Western Canadian Select—is determined by international markets, not by U.S. tariffs on steel or aluminum. The excuse doesn’t hold water. But it doesn’t need to. It just needs to last until the election.

The List of Real Problems We Ignore

While the country celebrates its 1,500th anniversary, here’s what remains broken. Housing: One in four Canadians spends more than 30% of their income on rent, and in major cities, it’s often 50% or more. Groceries: The average grocery bill has risen by more than $1,200 per family since 2022. Interest rates: Despite recent cuts, hundreds of thousands of homeowners face catastrophic mortgage renewals in 2025 and 2026.

The suspension of the gas tax does nothing to address any of these problems. It doesn’t build a single home. It doesn’t lower the price of a single liter of milk. It doesn’t protect a single family from the mortgage shock. It does exactly what it’s designed to do: create the illusion of action at the lowest possible political cost.

The Invisible Opportunity Cost

Every dollar spent on one measure is a dollar not spent on another. The 1 to 2 billion this suspension will cost could have funded 10,000 units of public housing. Or doubled the supplement to the Canada Child Benefit for six months. Or invested in intercity public transit that would eliminate the very need to drive for thousands of Canadians.

But building housing takes three years. Improving public transit takes a decade. And the elections are just a few weeks away. So we suspend a tax. Because it’s immediate. Because it’s visible. Because it makes for a good newspaper headline.

Three precedents that tell the same story

In 2022, Jason Kenney’s Alberta suspended its provincial gas tax. Temporarily. It still hadn’t been fully reinstated by 2025. In 2024, Trudeau suspended the carbon tax on heating oil in the Atlantic provinces. Temporarily. It has become a permanent election issue. Also in 2024, the same Trudeau launches the “GST Holiday.” Temporary. Two months later, he is no longer prime minister.

The pattern is always the same. A government in trouble announces a “temporary” suspension. The media covers it. The opposition either approves or remains silent. The measure ends amid indifference. No structural problems are solved. And six months later, the same cycle begins again with a new emergency, a new suspension, a new check.

Fiscal Addiction as a Mode of Governance

There’s a word to describe a system that needs increasing doses of the same stimulant to produce the same effect: addiction. Canada has become addicted to temporary tax handouts as a tool of governance. Every crisis—real or perceived—produces a new check, a new suspension, a new tax credit. And each dose is less effective than the last, because the public gets used to it, because the real problems are getting worse, because the debt is piling up.

And yet, no party—neither Liberal, nor Conservative, nor New Democratic—has the courage to state the simplest truth in the world: you cannot lower taxes AND increase services AND reduce debt. Choose two. Not three.

When Harper did exactly the same thing

Jim Flaherty, Stephen Harper’s finance minister, had cut the GST from 7% to 6%, then to 5% in 2006 and 2008. Every economist—every single one, without exception, from the left and the right—had said that this was the worst possible way to cut taxes. That a reduction in income tax would have been more effective, more targeted, and more progressive. Harper did it anyway. Because every Canadian sees the GST on their receipt. It’s tangible. It’s part of daily life. It’s politically irresistible.

Carney is doing the same thing with the gas tax. Different party. Same cynicism. Same calculation. And in twenty years, when a historian looks back on Canada’s fiscal decline, this suspension will be another nail in a coffin that’s already firmly shut.

Amnesia as a Political Skill

The genius of Canadian politics is that every government starts with a clean slate. No lessons are learned. No precedents are cited. The same mistakes are made with the same conviction, the same smile, the same press conferences in front of a podium bearing the inscription “For Canadians.” And Canadians—tired, in debt, and overwhelmed by everything—accept the check and return to their impossible daily lives.

Alberta, Saskatchewan, and Strategic Silence

Danielle Smith doesn’t need to criticize this measure. It serves her perfectly. Every time Ottawa admits that energy taxes are a problem, it validates the narrative Alberta has been pushing for thirty years. “We told you so. Federal energy taxes are stifling Canadians.” Carney’s suspension is a rhetorical gift to the energy-producing provinces.

And when the measure expires, Smith will be able to point to Ottawa and say, “They gave it to you, and now they’re taking it back. Just like always.” Regional resentment—that slow-acting poison that has been corroding the federation since Trudeau Sr.—has just received a dose of fertilizer courtesy of Ottawa itself.

Quebec, silent as usual on the oil issue

In Quebec, the reaction is predictable. Motorists are cheering. Environmentalists are groaning. The Legault government, entangled in its own energy contradictions—green electricity at home, gas-guzzling SUVs in the garage—will say nothing of substance. Because in Quebec, saying anything about gas prices is like stepping into a minefield where every word can explode in three directions at once.

The real cost isn’t fiscal—it’s democratic

The deepest problem with this announcement isn’t budgetary. It’s democratic. An unelected prime minister has just made a major tax decision without a mandate, without substantive parliamentary debate, without a published impact assessment, and without public consultation. The decision was made in an office, announced in front of cameras, and applauded by a country too weary to ask questions.

This is governance by announcement. Politics as a series of press releases. Democracy reduced to a news cycle where each headline replaces the last, where each measure is forgotten before it has had any effect, where public debate is replaced by instant reaction.

What We Really Deserve

Canadians deserve better than sixty-two cents a day. They deserve a government that explains why refining margins have doubled and what it plans to do about it. They deserve an energy policy that doesn’t change direction with every poll. They deserve an honest debate on the carbon tax: either it’s necessary and we keep it, or it isn’t and we abolish it. But this “we’ll keep it, but we’ll suspend it, but we’ll reinstate it, but we’ll suspend it again” dance is an insult to the collective intelligence of the people.

And above all, they deserve an election. Now. Not after another announcement. Not after another check. Now. Because a prime minister who distributes public funds without a popular mandate—no matter how brilliant, competent, or well-intentioned he may be—is exercising a form of power that has a name: benevolent rule by decree. And history teaches us that the benevolence of such decrees never survives the intoxication of power for long.

What This Measure Reveals About Us

This suspension of the gas tax doesn’t reveal much about Mark Carney. We already knew he was intelligent, strategic, and capable of sophisticated political calculations. What it does reveal is something about us. About our appetite for easy solutions. About our willingness to believe that a $300 billion problem can be solved with a $9 check. About our ability to cheer the disappearance of a symptom while the disease worsens.

Mark Carney is suspending the gas tax because he knows it works. He knows the polls will rise. He knows the street interviews will be favorable. He knows the opposition will be torn between applauding and criticizing. He knows the media will cover it, analyze it, and move on to the next topic by Friday.

The question that will remain after the election

Once the elections are over—whether Carney wins or loses—the tax will either be reinstated or it won’t. Refining margins will still be obscene. Housing will still be unaffordable. The debt will still be staggering. And Canadians will wonder, as they do after every election cycle, why nothing really changes. The answer is simple. Nothing changes because we reward politicians who offer us candy and punish those who offer us the truth. And as long as that equation remains intact, we’ll have the governments—and gas prices—we deserve.

Sixty-two cents a day. That’s the price Mark Carney is paying for your silence. The question isn’t whether it’s enough. The question is how long you’ll let yourselves be bought off so cheaply.

Signed, Jacques PJ Provost