The federal fuel excise tax will stay suspended until the end of January, the government announced on Tuesday from Brantford — about 10 cents a litre off gasoline and 4 cents off diesel that would otherwise have come back.
The suspension was introduced on April 20 this year and had been due to end. It now runs to and including January 31, 2027. From February 1 to March 31, 2027, half the normal rate applies: 5 cents a litre on gasoline and unleaded aviation gasoline, 5.5 cents on leaded aviation gasoline, and 2 cents on diesel and aviation fuel. Full rates return on April 1, 2027.
Ottawa puts the added cost of the extension at about $2.9 billion, bringing the estimated total fuel tax relief for 2026-27 to $5.3 billion.
Public Safety Minister Gary Anandasangaree, who made the announcement, tied it to the tariff fight and to costs generally. “We know that affordability is the single most pressing issue for many Canadians, including here in Brantford,” he said in the release. Finance Minister François-Philippe Champagne said the extension would “keep more money in Canadians’ pockets.”
The government says pump prices dropped 11 cents a litre on the first day the suspension took effect in April. What a driver actually pays also moves with crude prices, provincial taxes and the retail margin, so the excise change is one input among several.
The announcement lands the same week Canada’s counter-tariffs on a list of American goods took effect, and the release names truckers and businesses in food, agriculture, housing, construction and delivery as the intended beneficiaries alongside households.
Source: Public Safety Canada, “The Government of Canada extends federal fuel excise tax relief on gasoline, diesel, and aviation fuels for Canadians”, September 8, 2026.
