Bill C-38

Canadian Fuel Affordability Act

An Act to amend the Excise Tax Act (extension of the federal fuel excise tax relief)

This enactment amends the Excise Tax Act to extend the temporary suspension of the federal fuel excise tax until January 31, 2027 and to temporarily set the excise tax rates on fuels to 50% of the regular rates for the period beginning on February 1, 2027 and ending on March 31, 2027.

Canadian Fuel Affordability Act

[Pierre Poilievre, Conservative, Leader of the Opposition]

Mr. Speaker, allow me to quote Robin, a widowed mother who wrote to me on Canada Day. She said that people talk about affordability in numbers but that she measures it differently. She measures it by the moments her kids ask, “Mom, can I have a three-dollar snack?”, and she says, “No, it's rent week.”

I also heard from Jennifer LaFramboise, a mother of four, who said that she owns a home and is working three jobs, one full-time and two part-time, trying to make ends meet. There are days when she has to invent new meals for her family to eat because she has four dollars left in her bank account until her next paycheque. She gets food only on apps such as Flashfood now, because that is all she can afford: discounted meals. She lives less than pay to pay, because her pay is never enough to meet anything on her bills.

Mike, a firefighter, business owner and father of three who lives in metro Vancouver, said that he and his wife work full-time. His wife is an educational assistant in the public school system, supporting teachers and children with diverse needs every day. Mike serves his community as a firefighter while also operating a small landscaping business. Between them, they are effectively working the equivalent of three jobs while raising three kids.

Mike said that, despite all their efforts, it was only recently that they managed to purchase their first home, a modest 1,200-square-foot townhouse that cost $879,000. He says that they are doing everything society asks of them: They work hard, pay their taxes and raise their children. They contribute to their community. However, they are barely keeping their heads above water. Mike says that he is burning the candle at both ends and is running out of candle.

Another single mother says that she has worked hard her entire life. She does not receive child support, and she does not expect handouts. She wants hard work to mean something again.

The Prime Minister tells Robin, Jennifer, Mike and the single mother that “Affordability is the best it has been in over a decade.” He said those words in March on the floor of the House of Commons. On behalf of them and all the hard-working Canadians who are scraping and scratching to survive in this terrible inflationary economy, let me say that the Prime Minister is out of touch and Canadians are out of money. If he thinks these are just selective anecdotes, I have hundreds, probably thousands, more in my correspondence. All the members of the Conservative caucus could share stories just like these ones.

These are the people we bump into on Main Street. They are the people who show up at food banks. They are the people who are still courageously and heroically volunteering for local charities while they can barely afford to feed themselves. These are the people we will not meet on the summit floor, nor will we see them at a salon in Davos nor on the Prime Minister's private jet, where he spends thousands of other people's tax dollars on meals. No, these are the people on the ground, and they are the people for whom we as Conservatives will fight every day and every way on the floor of the House of Commons.

If the Prime Minister does not like stories, then let us go with some statistics. Rising prices at the grocery store have doubled food insecurity from 5.1% in 2017 to 10.5% last year, according to the Agri-Food Analytics Lab. A Royal Bank study found that more than half of parents with adult children aged 18 to 40 provide financial support, contributing, on average, $6,100 a year. Nearly one in five elderly people is forced to give $10,000 to support their adult children. According to the Telus mental health index, cost of living is the top financial stressor for two-thirds of workers.

The federal government's largest national count found that homelessness was 59% higher in 2022, with unsheltered homelessness up 89%. Consumer insolvencies in the second quarter of this year, the most recently reported one, were 37,523. That is the number of people who are selling everything so they do not have to declare bankruptcy. In fact, insolvencies are now at their highest level since the great global recession. The Prime Minister dares tell these people who are losing their homes and everything they worked so hard to acquire that they have never had it so good, and that affordability is the best it has been in a decade.

These are the stories the government would love to silence, that it would like to gaslight out of existence by telling us affordability is great. These are the stories we do not hear from the mainstream media, which would have covered it all up in order to protect the Liberal government.

We will not be silenced. We as Conservatives will be telling these stories on the floor of the House of Commons and offering real solutions to save Canadians money on gas, groceries, rent and mortgage payments. That includes tackling the inflationary taxes and deficits of the Prime Minister, which have worsened under his leadership. In fact, the deficit has doubled since he took office. The Liberals inherited a large deficit from themselves, and they managed to double it in a very short period of time.

We are relieved to see that our efforts to fight gas taxes have led to a temporary pause on part of those taxes. The Liberals we know would not have cut one penny off the gas tax for one minute had it not been for the relentless fighting and advocacy of the Conservatives on this side of the House, and we will keep fighting. We are only getting started.

The reality is that there are three taxes on gas. There is the excise tax, which we have forced the government to pause. There is the GST, which the government continues to collect and from which it continues to profit on higher gas prices because it is a percentage-based tax. Then, of course, there is the fuel standard tax. The Prime Minister said on the floor of the House of Commons yesterday that this tax adds zero to gas prices. His own Environment Canada website says that it is seven cents per litre right now and that within three and a half years it will be 17¢ per litre, the same rate as the previous Liberal consumer carbon tax. The only difference is that this carbon tax does not have a rebate, which makes it even worse.

Our message is to get rid of the fuel standard tax and the industrial carbon tax forever, and to get rid of the other gas taxes until at least Canada Day. This would save Canadians 25¢ a litre, 20 bucks a fill-up, and about $1,000 total, money that real people who are fighting every day just to raise their families could definitely use in order to build their lives.

The Prime Minister said yesterday as well that the industrial carbon tax has zero impact on food prices. I am not surprised that he is confused on this, because he famously said that Canadians do not use steel anymore. Let me tell the House that not only do Canadians use steel, but farmers use steel. Their equipment is made out of steel. When we tax the steel that goes into farm equipment and then tax the fertilizer that goes on the crops, which the Prime Minister has done, we tax all the food that comes from those crops.

That is why, while there are some global factors, the reality is that Canada has had the worst food price inflation for most of the Prime Minister's tenure in office, worse than the U.S., worse than the U.K., and worse than Italy, Japan, Germany and France. It is worse because his policies are worse. By reversing all of these taxes, we could bring down the cost of food and everything else.

Furthermore, do members know what else lowers the price when we purchase something? It is having a stronger dollar. We have a weak dollar right now because of the decade-long policy of the Liberal government to try to keep our most valuable export, oil and gas, in the ground. The Prime Minister was the global champion of net zero, saying that we needed to keep half of oil and gas in the ground. He promised that he would reverse himself on these policies, but since the last election, what have we seen? Yesterday he introduced a bill that he promised is going to speed up projects. That is what he promised 18 months ago. He introduced a bill called the Building Canada Act. What did it do? In 18 months, it has not approved a single, solitary project across this country.

We do not need another announcement. We do not need another press conference or summit. We need a real bill that would scrap all the antidevelopment laws, approve the 500 projects that are waiting for permits, and unlock and unblock our resources so we can bring them to the surface and bring strength to our dollar and purchasing power to the Canadian people so the hard-working people whose stories I told at the beginning will be rewarded, and so the promise of Canada will mean they can have a beautiful house, food on the table, a safe street and a mortgage they can pay down.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, I think it is important that the leader of the Conservative Party get a bit of a reality check. Under 18 months ago, when the Prime Minister was elected, one of the very first actions he did was to reduce middle-class taxes. Twenty-two million Canadians benefited from it. We can talk about the excise gas tax relief today, of 10¢ a litre. We can talk about how the Prime Minister got rid of the carbon tax. We can also talk about the Canadian grocery benefit.

These are some of the direct benefits, not to mention benefits such as the national school food program or the child care enhancements, the dental program and the pharmacare enhancement.

Why will the leader not support the entire package we brought forward to deal with the issue of affordability?

[Pierre Poilievre, Conservative, Battle River—Crowfoot, AB]

Madam Speaker, it is because the entire package the Liberal government has brought forward is bankrupting Canadians. They cannot afford to pay the cost of the Liberal government. If any of those programs actually worked, we would not have double the number of people lined up at food banks, a number that has gone up by 100% since 2019 and continues to go up under the Prime Minister. If his whole basket of programs were actually working, we would not be getting letters from people such as Robin, Mike and Jennifer, who say they cannot pay their bills. We would not have the devastating statistics showing how many people are going hungry and homeless.

What we want is more results and less talk. We will fight every day and every way for Canada and for Canadians.

[Heather McPherson, NDP, Edmonton Strathcona, AB]

Madam Speaker, the leader of the official opposition talks a lot about affordability. For millions of Canadians, affordability is not about tax cuts or corporate profits. It is about whether they can actually pay their bills, of course. This is particularly challenging for seniors. I think about Bev, a senior in my constituency who is very worried about becoming unhoused. Seniors are the population fastest becoming unhoused in the country right now.

My question is simple. Will the Conservative Party commit to specific measures to help seniors afford groceries, such as increasing income supports, strengthening the guaranteed income supplement and indexing benefits to the real cost of living? Will the member commit to that now?

[Pierre Poilievre, Conservative, Battle River—Crowfoot, AB]

Madam Speaker, absolutely, benefits should be indexed to the real cost of living. Absolutely, we will always support measures to make life affordable for our seniors, to save seniors money.

That is the opposite of what the Liberal government has done over the last decade by inflating the cost of living with record deficits. This year, the deficit is the biggest it has ever been outside COVID. Government spending as a share of GDP is the highest it has been since 1996. That inflation is destroying the savings and purchasing power of our hard-working seniors. They are getting less for the money they set aside. On top of that, their adult children have to come asking for help for a down payment or just to avoid rent eviction.

We are fighting for these seniors, for their kids, for all generations and for Canada's promise.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Madam Speaker, it is a very difficult problem, for those of us who are committed to basing policies on science, to watch the Liberal Party squander what it had, which was basically a puffed-up, false reputation on climate in the first place, and then have the Conservative Party prop the Liberals up at the very moment when the Conservative Party should also say that not only is the Liberal Party driving up the fiscal deficit, but that it is also driving up the climate deficit. Canada now has a worse record on climate, and let this sink in, than the United States does, after one and a half terms of Donald Trump. It matters to Canadians, because affordability also includes running for one's life from wildfires.

[Pierre Poilievre, Conservative, Battle River—Crowfoot, AB]

Madam Speaker, Canadians are running for their lives to try to pay their bills. I would note that we could fight wildfires if we had water bombers instead of spending half a trillion dollars fighting oil and gas and fighting against Canadians using gas at the pump, as the member suggests.

However, I can understand why she is heartbroken. For a decade, the Liberal Prime Minister said that he supported net-zero policies, that he wanted to keep more than half our oil and gas in the ground and that he wanted even higher and broader carbon taxes. He now claims to have changed his mind. He never believed it. It was all a money grab from the very start.

We on this side have been consistent. We are fighting for affordability, for low energy prices and for the massive production of our oil, gas and other resources.

[Jennifer McKelvie, Liberal, Parliamentary Secretary to the Minister of Housing and Infrastructure]

Madam Speaker, I will be sharing my time with the member for Surrey Newton.

I want to start by giving my thanks for the opportunity to contribute to today's debate on Bill C-38, the Canadian fuel affordability act.

The world is changing rapidly, but Canada is starting from a position of strength. Events like new tariffs, trade tensions and conflicts abroad continue to affect costs for households and businesses and create uncertainty for Canadians, but we all know that Canada is well positioned to manage these pressures thanks to our robust economy and our clear growth strategy, which is focused on driving investment, boosting productivity, strengthening domestic industries and expanding access to global markets.

In Canada, we have the good fortune of being a net energy exporter. Our resource wealth insulates us from the worst impacts of these disruptions. Canada is an energy superpower, and our government is capitalizing on this advantage by building new infrastructure projects that will increase our energy supply, with new nuclear, new hydro and new LNG facilities. However, we are not immune to systemic global shocks. That is why our government is taking action to help Canadians through these challenges.

In April, our government temporarily suspended the federal fuel excise tax following disruptions to crude oil shipments through the Strait of Hormuz that drove up fuel prices. The measures have been saving Canadians and Canadian businesses up to 10¢ per litre on gasoline and unleaded aviation gasoline, up to 11¢ per litre on leaded aviation gasoline and up to four cents per litre on diesel and aviation fuel.

When the temporary suspension of the federal fuel excise tax was first introduced, gasoline prices declined by 11¢ per litre on the first day of implementation, delivering immediate relief to consumers. With today's legislation, we are continuing to provide relief at the pump by proposing to extend the temporary suspension of the federal fuel excise tax until January 31, 2027, and then applying 50% of the regular excise tax rate from February 1 through to May 31, 2027, inclusively. This will bring down costs for Canadians, including truckers and businesses in the food, agriculture, housing, construction and delivery sectors. This means we are delivering timely, meaningful and tangible relief for Canadians at a time when they need it the most. By reducing pressure on fuel costs at the pump for gasoline and diesel, we are taking concrete steps to lower costs for Canadians today while we continue to build a stronger, more resilient and more independent economy.

This action builds on one of the very first measures we took as a government, which also lowered costs at the pump in most provinces and territories. The House will recall that one of the first things the Prime Minister did upon assuming office was to cancel the consumer fuel charge, helping Canadians to save money at the pump in most provinces and territories. Our government also removed the requirement for provinces and territories to have a consumer-facing carbon price, as of April 1, 2025.

At the same time, our government also understands that Canadians do not just spend money on gasoline. That is why we have been taking action to reduce pressure on costs and make life more affordable for Canadians across the board. For example, our government introduced the new Canada groceries and essentials benefit. By building upon the former goods and services tax credit, we are increasing its amount by 25% for five years as of July. In addition to that, we provided a one-time payment in June, equivalent to a 50% increase in the 2025-26 annual value of the GST credit. Combined, this means a family of four will receive up to $1,890 this year and about $1,400 a year for the next four years, while a single person will receive up to $950 this year and about $700 a year for the next four years. That is literally making life more affordable for millions and millions of Canadians. In fact, the new Canada groceries and essentials benefit will provide additional significant support for up to 12 million Canadians.

Not only are we putting more money in the pockets of those who need it the most, but we are also leaving more money in their pockets with our middle-class tax cut, because we have lowered the first marginal personal income tax rate from 15% to 14% since July 1, 2025. Nearly 22 million Canadians are benefiting from this tax relief of up to $420 per person, saving a two-income family $840 this year.

This rate reduction applies to a taxable income of up to $58,523 in 2026, providing meaningful relief to Canadians during the current period of economic uncertainty. What is more, the bulk of tax relief will go to those with incomes in the two lowest tax brackets, including nearly half to those in the first bracket. This means the relief is effectively targeted to Canadians who need help the most.

In this regard, no one is more important to consider than our children. That is why we made the national school food program permanent. It provides meals to up to 400,000 kids annually. This program helps ensure that kids are fed healthy meals at school, and it saves families with two children up to $800 a year on groceries. By making it permanent, we will work with provinces, territories and indigenous partners to expand the program into more schools across Canada.

We are also aware that affordability pressures go beyond fuel and food and are affecting other essential expenses, including housing. That is why we introduced the first-time homebuyers' GST rebate. With this rebate, we will have effectively eliminated the GST for first-time homebuyers on new homes up to $1 million and reduced the GST for first-time homebuyers on new homes between $1 million and $1.5 million. This tax cut for first-time homebuyers will save Canadians up to $50,000, allowing more young people and families to enter the housing market and making the goal of home ownership a reality for more Canadians.

These are just a few of the examples of how we are bringing costs down for Canadians. By lowering costs, the government is creating an economy where every Canadian has more control over building their own future. Above all, our government will empower Canadians by helping them get ahead and reduce their cost of living. When Canadians keep more of the money they earn, they are better supporting their families, investing in their communities and building the future they want.

That is why I strongly encourage all members of this House to support Bill C-38, so that we can build a strong Canada for all.

[Warren Steinley, Conservative, Regina—Lewvan, SK]

Madam Speaker, the member went through all the programs that Canadians have, including the new grocery rebate. Is that really an admission that their policies are failing? The fact that they have to give Canadians more money back in programs means they cannot afford food on their own.

The member has been in the House for a while. Why did she vote against our motion to take the tax off gas four or five times last spring?

[Jennifer McKelvie, Liberal, Ajax, ON]

Madam Speaker, we have many measures that we have implemented to help Canadians with affordability, and the member opposite mentioned just one of them.

In addition to the groceries and essentials benefit, we have cut taxes for 22 million Canadians. We have eliminated the GST for first-time homebuyers. We are continuing to make investments in climate action by investing in communities from coast to coast to coast through the build communities strong fund and through the expansion of electricity in projects that we have been funding across the country.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Madam Speaker, first, I want to thank my colleague for talking about our children.

This bill would create a debt of $5.3 billion. As New Democrats, we support the relief to consumers from the gas tax savings. What we do not support is putting this on the backs of future generations. We believe that big oil and gas, which is making record profits, should be shouldering and sharing some of this. We are seeing excess profits like we have never seen, obscene profits in the tens of billions of dollars.

Does my colleague not agree and believe that the big oil and gas companies that are profiting from a war and showing record profits should cover the costs of what Liberals are putting in this bill, taking the pressure off everyday Canadians?

[Jennifer McKelvie, Liberal, Ajax, ON]

Madam Speaker, we continue to invest in climate action. We continue to have industrial carbon pricing, which is essential for having responsible energy management in our country and for demonstrating to our partners overseas that we are serious about being clean, being green and being an energy superpower.

In addition, we continue to have the clean fuel regulations. These regulations do not set a price at the pump, but they do provide a flexible tool that supports good-paying jobs, drives billions of dollars of investment, strengthens certainty and reduces pollution, all while we continue to invest in clean energy and renewable energy across our country.

That is what we are doing for future generations. That is how we are showing climate action. That is how we are showing that we care about the environment.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, I am wondering if my colleague could provide her thoughts on the degree to which the government, and in particular the government caucus, is focused on the issue of affordability.

Today is one example. Through legislation, we would give a very serious extension of a tax break on the excise tax on gas, 10¢ a litre to the end of January and then five cents a litre to the end of March. It is real, tangible and money in Canadians' pockets, but it is part of a bigger affordability agenda. There are tax breaks for 22 million people, and there is support for child care, the dental program and the pharmacare program. There are different ways that we as a government, led by our Prime Minister, are pushing the issue of affordability for Canadians.

I would ask the member to provide further comment on that.

[Jennifer McKelvie, Liberal, Ajax, ON]

Madam Speaker, we are definitely in difficult times, with pressures internationally that we have never seen before that are having an impact on affordability in our country. To grow our economy and get through the unjustified tariff war and the pressures we have from wars overseas, we are continuing to invest in ourselves and are taking different measures on affordability, including the ones my colleague mentioned.

To make it easier, we have cancelled the consumer fuel carbon tax, we have made the national school food program permanent and we are creating automatic federal benefits to make it easier for Canadians to access the affordability measures that help their bottom line. We are also continuing to expand and entrench the child care benefit so that women in particular can be their full selves in the workforce and have the care they need to reach their full potential in their careers.

These are just some of the measures we are working on, and we will continue to do that.

[Sukh Dhaliwal, Liberal, Surrey Newton, BC]

Madam Speaker, I am pleased to rise today to speak to Bill C-38, the Canadian fuel affordability act.

Across Canada, families, workers, farmers and businesses continue to face pressures from rising costs. Whether it is filling up a vehicle, transporting goods or managing the operating costs of a small business, affordability remains an important concern for Canadians.

During the summer, I attended hundreds of events and met thousands of my constituents. One thing I learned from them is that the Prime Minister and the government are doing their best, and they are very happy with the leadership of the Prime Minister. Most importantly, our government understands the challenges these Canadians are facing. That is why we are taking steps to help Canadians manage their expenses while continuing to build a stronger and more independent Canadian economy.

Bill C-38 is about providing immediate relief at the gas pump. Earlier this year, in April, we temporarily suspended the federal fuel excise tax on gas, diesel and aviation fuels. This measure provided savings of 10¢ per litre on gas and four cents per litre on diesel and aviation fuel.

Bill C-38 would extend this relief. This legislation would maintain the federal fuel excise tax at zero until January 31, 2027. From February 1 to March 31, 2027, the tax would be set to 50% of the regular rate, which would help Canadians manage the transition back to the regular excise tax rates. For gasoline, the extension is expected to provide savings of up to 10¢ per litre until February 2027, followed by a savings of five cents per litre through March 2027. For diesel, the savings are expected to be up to four cents per litre until February and up to two cents per litre through March.

These savings matter. When families are already managing the cost of groceries, housing, utilities and transportation, every dollar can make a difference. For a family that depends on a vehicle to get to work, take children to school or attend a doctor's appointment, fuel is not an optional expense. It is a necessary part of everyday life.

In Surrey, Newton, I hear from families and small business owners who are working hard to manage their expenses. Our community includes commuters, delivery workers, tradespeople and entrepreneurs who depend on transportation to earn a living. Reducing fuel costs can help these Canadians manage their daily expenses.

The benefits would also extend beyond the gas station. Truckers and businesses in the food, agriculture, housing, construction and delivery sectors depend on fuel to operate. Lower fuel costs can help reduce operating expenses and support the movement of goods across Canada. When a truck transports food to the grocery store, a construction company moves equipment to a workplace or a small business delivers products to its customers, fuel costs play an important part. This measure would provide temporary support to businesses facing economic uncertainty.

Canada is operating in a changing global environment. International conflicts and disruptions in global energy markets have placed pressures on fuel prices. At the same time, Canadian businesses and families are dealing with uncertainty related to international trade and tariffs. We cannot control every global event that affects the price of oil or gasoline. However, we can make decisions within our control to support Canadians.

Our government is also taking broader action to make life more affordable. We are lowering the personal income tax from 15% to 14%, providing tax relief of up to $420 per year per person or up to $840 for a two-income family. We have also cancelled the federal consumer carbon tax, provided GST relief for eligible first-time homebuyers and taken steps to strengthen competition in essential services. These measures address different areas of household expenses.

Affordability is not only about the price Canadians pay today. It is also about building an economy that creates good-paying jobs, attracts investment and supports long-term economic security. As we provide temporary relief from fuel costs, we must also continue working toward a competitive and sustainable Canadian economy.

Our industrial carbon pricing system is distinct from the consumer carbon pricing. It is designed to support Canada's position as a responsible energy supplier, encourage investment in emission-reducing technologies and strengthen access to international markets. Canada has the opportunity to grow its energy exports, create jobs and attract investment while continuing to address environmental challenges. We must approach these objectives together.

I recognize that members of the House may have different views about the duration and design of fuel tax relief. There can be legitimate discussions about the fiscal costs, the duration of temporary measures and how best to support Canadians facing financial challenges and pressures. However, Bill C-38 provides a specific and time-limited measure to reduce the federal fuel excise tax. It offers continued relief until the end of January, followed by a temporary reduction in the regular rate through March 2027.

Families and businesses need support today, and they also need an economy that is prepared for the future. As the MP for Surrey Newton, I will continue to support measures that address affordability concerns in our community and across Canada. Our government is focused on helping Canadians keep more of their hard-earned money while strengthening our economy.

I encourage all members to support Bill C-38 so that Canadians get the relief they deserve.