Ontario Permanently Cutting the Gas Tax and Taking Tolls Off Highway 407 East

Province keeping costs down for families in the face of tariffs and economic uncertainty

The Voice of Canada News:

As part of its plan to protect Ontario, the government is continuing to lower costs for hard-working families, support local businesses and put more money back into people’s pockets through its plan to permanently cut the gasoline and fuel tax rates, which would save households, on average, about $115 per year going forward. The government is also proposing to remove tolls from the provincially owned Highway 407 East, which is expected to save daily commuters an estimated $7,200 annually.

“I know that families and business owners are worried about rising costs, especially as U.S. tariffs threaten to raise the price of everyday essentials,” said Premier Doug Ford. “That’s why we’re cutting the gas tax permanently and taking tolls off Highway 407 East, and that’s why we’ll always keep looking for ways to put more money back into the pockets of Ontario families.”

To provide ongoing relief to households and businesses in Ontario, the government is introducing legislation through its 2025 Budget that would, if passed, make the cut to the gas and fuel tax rate permanent, keeping the provincial rates of tax at nine cents per litre. This permanent measure would support continued relief at the pumps, building on the $1.7 billion that households have saved since the government first announced temporary cuts to the gasoline and fuel tax rates in 2022.

“Ontario families have seen prices on everyday items go up over the last several years,” said Peter Bethlenfalvy, Minister of Finance. “To help Ontarians cope with the high cost of living and the impacts of the economic uncertainty caused by tariffs, we are continuing to take action to ease the pressure and do more to help lower costs for households.”

To help lower costs and fight gridlock, the government is introducing legislation that would, if passed, permanently remove tolls from the provincially owned section of Highway 407, from Brock Road to Highway 35/115, effective June 1, 2025. This is the last stretch of provincially owned tolled highway in Ontario and follows the government’s previous removal of tolls from Highways 412 and 418, and its recent legislation banning new road tolls on any public roadway in Ontario.

“Our government is making it easier and more affordable for Ontarians to get where they need to go, when they need to get there,” said Prabmeet Sarkaria, Minister of Transportation. “The measures announced today will not only help to reduce traffic and commute times, but they will help put money back in the pockets of hardworking families at a time when it matters most. This is another step in our work to protect Ontario by building a more efficient, affordable and accessible transportation network.”

The government is committed to keeping costs down for commuters. Additional initiatives the government has taken include the elimination of licence plate renewal fees and stickers and freezing fees for driver’s licences and Ontario Photo Cards, which combined with previous cuts to gas and fuel tax rates have saved individuals and families over $1.8 billion in the last year.

“Our government is focused on protecting jobs and reducing costs for families, as we stand up for Canada against U.S. tariffs,” said Stephen Lecce, Minister of Energy and Mines. “By permanently cutting the gas tax, we’re fulfilling our commitment to put more money back into the pockets of hardworking families, where it belongs.”

More information about the government’s plan to protect Ontario, grow our economy and make Ontario the most competitive jurisdiction in the G7 to invest will be included in the 2025 Budget, to be released on May 15, 2025.

Quick Facts

• Ontario temporarily cut the gasoline tax rate by 5.7 cents per litre and the fuel (diesel) tax rate by 5.3 cents per litre on July 1, 2022, and has extended the cuts four times.
• The price consumers pay at the pump is made up of the cost of crude oil, wholesale margins, retail margins, federal excise tax, Ontario gasoline/fuel tax and HST.
• While the government has taken action on tax rates for unleaded gasoline and fuel (diesel), there will be no change to tax rates for leaded gasoline or aviation fuel.
• While the government welcomes the federal decision to set the carbon tax rate to zero effective April 1, 2025, it continues to call for the complete repeal and elimination of the carbon tax.
• In 2024, Ontario passed legislation that prohibits the province from introducing new tolls on provincial highways.

Quotes
“In the face of economic uncertainty, we are using every tool in our toolbox to reduce gridlock and keep costs down for workers and families here in Durham and across Ontario.”- Todd McCarthy, MPP, Durham

“With today’s announcement, we’re helping residents travel more easily throughout the Region of Durham, while furthering our commitment to put more money back in the pockets of hardworking Ontarians. This follows our previous initiative, which removed tolls on Highways 412 and 418, and now we’re taking another meaningful step to make life more affordable for families, commuters and businesses in Whitby and across Durham Region.”-Lorne Coe, MPP, Whitby

“This is great news for the residents of Durham Region. Permanently cutting the gas tax and removing tolls on Highway 407 East will benefit our residents and businesses greatly. It will ease pressures during a time of reduced affordability by bringing down the cost of living, improving mobility, fighting congestion on our highways and supporting local and provincial economic growth. Thank you to the Government of Ontario for its commitment to putting more money back in the hands of our residents.”- John Henry, Regional Chair and Chief Executive Officer, Regional Municipality of Durham

“With the rising cost of living and continued economic pressures, today’s announcement is a significant step forward for hardworking families. These are tangible, meaningful actions that will ease the financial burden on households, reduce commute times, and support the flow of people and goods throughout our region. These actions reflect a clear understanding of the pressures faced by commuters and everyday Ontarians and I applaud this continued commitment to affordability, accessibility and mobility.”- Kevin Ashe, Mayor of Pickering

“By announcing plans to cut the gas tax permanently and remove tolls on the provincially owned Highway 407 East, the Ontario government is demonstrating that it is committed to helping families and individuals who are facing today’s economic challenges. Premier Ford’s announcement is welcome news for the Oshawa community and beyond — these bold actions will reduce expenses for households and reduce congestion on our highways.”- Dan Carter, Mayor of Oshawa

“This is fantastic news for Clarington and Durham Region. The Ford government is delivering on a key election promise — one that will ease the financial burden on residents while making commuting more convenient. Initiatives like this play a vital role in enhancing the quality of life in our communities and saving people money.”-Adrian Foster, Mayor of Clarington

“We applaud the Ontario government for listening and acting on our Top 10 recommendation to make Ontario’s gas and fuel tax cuts permanent. An overwhelming 88 per cent of Ontario small business owners support this meaningful relief measure. It will help them continue to address the ever-rising costs of doing business and provide predictability in turbulent times and beyond.”- Julie Kwiecinski
Director of Provincial Affairs (Ontario), Canadian Federation of Independent Business

“The announcement to permanently extend fuel tax relief for the trucking industry is a measure all Ontarians should applaud. Essentially every item or product Ontarians have at home, or their places of business, was moved by truck. Fuel is typically the second leading cost behind labour for the trucking industry. This announcement helps fight inflation and assists trucking companies dealing with cash flow challenges during the tariff war with the United States. The Ontario Trucking Association applauds the Government of Ontario for its leadership and assisting the trucking industry and consumers in these challenging times.”- Stephen Laskowski, President and CEO, Ontario Trucking Association

“Making gas tax relief permanent is a significant benefit to the foodservice industry, as it increases consumers’ disposable income, which is spent enjoying meals at restaurants while also helping to offset our operating costs. We are grateful for the Ontario government’s continued support, including the recent HST holiday, the return of substantial WSIB surpluses, leadership in advancing the removal of interprovincial trade barriers, the earlier distribution of $200 relief payments to Ontarians, and the commitment to raise the LCBO discount for restaurants from 10 per cent to 15 per cent. These measures play a vital role in supporting our industry and safeguarding jobs.”-Kelly Higginson, President and CEO, Restaurants Canada