A cut to the provincial gas tax promised by Premier Doug Ford before the June election takes effect on Friday and experts say it may offer some relief to drivers facing sky-high pump prices, but the long-term benefits to consumers are unpredictable.
The government passed legislation this spring to lower the gas tax by 5.7 cents per litre and the fuel tax, which covers diesel, by 5.3 cents per litre for six months.
The changes will be in effect from July 1 to Dec. 31 with the government pegging the cost at $645 million.
Regular fuel prices are hovering at close to or above $2 per litre in cities across the province.
Roger McKnight, chief petroleum analyst with En-Pro International, says the upcoming gas tax cut is an overdue “Band-Aid solution” but consumers will likely see some benefit in its early days.
As of Thursday afternoon, McKnight calculated that prices drops at Ontario pumps should be around 11 cents per litre on Friday, bringing prices to an average of 1.929 per litre.