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Governments must cut fuel taxes for Islanders

Author: Devin Drover 2026/08/19

The Canadian Taxpayers Federation is calling on the Lantz government to cut its provincial fuel tax as the CTF releases its annual Gas Tax Honesty Report. The CTF is also calling on the Carney government to keep its fuel tax cut in place.

“Islanders are struggling every time they fill up and the provincial and federal governments both need to cut fuel taxes now,” said Devin Drover, CTF Atlantic Director and General Counsel. “Premier Rob Lantz needs to cut P.E.I.’s fuel tax and the feds need to scrap their plans to hike gas taxes next month.”

The CTF shows how much tax drivers are paying per litre of gasoline and diesel across Canada in its 28th annual Gas Tax Honesty Report.

Islanders pay about 39 cents in federal and provincial taxes per litre of gasoline and 47 cents per litre of diesel. Taxes make up 22 per cent of the price at the pumps in P.E.I.

Island drivers also pay a tax-on-tax of about three cents per litre because sales taxes are charged after all the per-litre taxes are added to the price.

The federal government suspended the federal fuel tax in April, saving drivers 10 cents per litre of gasoline and four cents per litre of diesel. The federal government is set to hike the tax back up on Sept. 8.

The CTF released Leger polling showing most Atlantic Canadians oppose the federal government hiking fuel taxes in September:

  • 49 per cent strongly oppose the tax increase
  • 15 per cent somewhat oppose the tax increase
  • 19 per cent somewhat support the tax increase
  • 6 per cent strongly support the tax increase
  • 11 per cent don’t know

Among those decided on the issue, 72 per cent of Atlantic Canadians oppose the fuel tax increase.

An average 64-litre fill-up in P.E.I. costs about $25 in taxes.

“Lantz needs to cut P.E.I.’s fuel tax and stop charging sales tax on top of gas taxes,” said Drover. “Carney needs to stop his plans to hike the federal fuel tax back up.”

To view the CTF’s full Gas Tax Honesty report, click HERE.

Gas taxes per litre in P.E.I.

Provincial fuel tax

8.5¢

Fuel regulation carbon tax

Provincial sales tax

15.6¢

Federal sales tax

7.8¢

TOTAL

38.9¢

 

Diesel taxes per litre in P.E.I.

Provincial fuel tax

14.2¢

Fuel regulation carbon tax

Provincial sales tax

17.6¢

Federal sales tax

8.8¢

TOTAL

46.6¢

 

 


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