Alberta to increase fuel tax by 4 cents starting April 1

Albertans will be paying more at the pumps for gasoline and diesel starting April 1, as the UCP government raises its provincial fuel tax.

The province said the increase is due to the average price of oil hovering below the $80 a barrel benchmark the government had previously set. Under the province’s affordability measures, the higher the average price of West Texas Intermediate (WTI) for the 20 trading days leading up to the 15th of the month preceding the start of the next quarter, the less fuel taxes Albertans have to pay.

The increase will bring the total tax to 13 cents a litre. The province said the program would be reviewed every quarter. On Thursday, oil was trading at $81.68 US.

At the average price of US$79.99 or less, Albertans pay the full 13 cents per litre. Between US$80 and US$84.99, a nine cent tax is added per litre of fuel. Between US$85 and US$89.99, a 4.5 cent per litre tax is added. And at US$90 barrels, fuel tax collection is paused.

“Revenue from the provincial fuel tax helps fund the programs, services and infrastructure Albertans rely on every day. In 2024-25, fuel tax revenue is forecast at $1.4 billion, which will help fund everything from better roads to improved health care and more supports in the classroom to continue to meet the needs of our growing population,” said Alberta Minister of Finance Nate Horner.

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The Fuel Tax Relief Program was introduced two years and the province said it’s has save Albertans approximately $2 million.

In December, the province said it would bring back a portion of its gas tax after putting it on hold to help Albertans deal with the affordability crisis.

In January, the province increased the fuel tax to nine cents a litre for the first quarter of 2024. The province had previously said there can only be a maximum of nine cents in increase of the gas tax between quarters to reduce price shock.

“The provincial oil price-based fuel tax relief program will be reinstated on Jan. 1, which means Albertans will continue to save money at the pumps,” Horner said in a statement.

The province said the tax will be reviewed again in June.

2:17 Fuel surcharge returns to Alberta gas stations