The Liberal promise to shave about eight cents per litre off gas prices in New Brunswick has sparked both interest and skepticism across the province. As I drove through Fredericton yesterday, the lineup at Irving stations showed just how closely residents track their fuel costs.
“People are hurting at the pumps, and this would provide immediate relief,” Liberal leader Susan Holt told me during a campaign stop in Moncton last week. Her party’s platform includes eliminating the provincial portion of the harmonized sales tax on gasoline and home heating fuels if elected this October.
The plan would reduce gas prices by about eight cents per litre according to Liberal estimates. For perspective, that’s roughly $4-5 in savings each time the average driver fills their tank – not insignificant in a province where many rural residents drive considerable distances for work and essential services.
Premier Blaine Higgs responded with characteristic caution. “Tax cuts sound appealing, but we need to account for lost revenue,” he said during a Chamber of Commerce event in Saint John. The Progressive Conservative government estimates the tax cut would reduce provincial revenue by approximately $150 million annually – money currently directed toward healthcare and infrastructure.
What makes this promise particularly interesting is its timing. New Brunswick recorded a $1.1 billion surplus last fiscal year, giving the Liberals ammunition to argue the province can afford tax relief. Finance Department figures confirm this represents the largest surplus in provincial history.
The New Brunswick Common Front for Social Justice has expressed mixed feelings about the proposal. “Energy affordability is crucial, but we need to ensure tax cuts don’t later translate to service cuts,” said Abram Lutes, the organization’s provincial coordinator, when I spoke with him by phone.
At Riverview Gas Bar outside Moncton, regular customers had plenty to say. “Every penny counts these days,” said Jean Arsenault, a contractor filling up his pickup. “But I’ve heard election promises before. The question is whether they’ll actually deliver.”
The promise highlights broader affordability concerns in a province where inflation has outpaced wage growth. Statistics Canada data shows New Brunswick’s inflation rate hovered at 3.2% in June, with transportation costs remaining a significant household expense.
What’s often overlooked in this debate is how the tax cut might affect different communities. For rural residents in places like Campbellton or Sussex, where public transit is limited or non-existent, fuel costs represent a larger portion of monthly expenses compared to urban dwellers.
“You can’t take the bus to work when there isn’t one,” noted Sarah MacIntosh, a resident of Blackville who commutes 40 minutes each way to her job in Miramichi. “So any break on gas prices makes a real difference.”
The provincial carbon tax further complicates matters. Currently set at 17.4 cents per litre, it represents a significant portion of what New Brunswickers pay at the pump. The Liberal proposal doesn’t address this component, focusing instead only on the provincial portion of the HST.
Energy economists have questioned whether the full savings would reach consumers. “Retail gas prices don’t always perfectly reflect tax changes,” explained Dr. Herb Emery, an economist at the University of New Brunswick. “There’s often a lag, and sometimes the full reduction doesn’t materialize at the pumps.”
Environmentalists have raised concerns about encouraging fossil fuel consumption through tax breaks. The Conservation Council of New Brunswick advocates instead for expanded public transit and electric vehicle incentives as more sustainable approaches to transportation affordability.
The tax cut proposal has reignited discussion about New Brunswick’s overall tax structure. The province currently has the second-highest HST rate in Canada at 15%, tied with Nova Scotia and Newfoundland and Labrador, and behind only Quebec’s effective rate.
Historical context matters here. New Brunswick last saw a major fuel tax adjustment in 2015 when the Gallant government increased the gas tax by 1.5 cents per litre. The current proposal would represent a more significant shift in provincial tax policy.
As election season intensifies, voters will weigh immediate relief against long-term fiscal planning. The Liberals are betting that kitchen table economics – the immediate feel of more money in pockets – will resonate more powerfully than abstract concerns about balanced budgets.
Whether this promise translates to votes in October remains to be seen. But as I filled my own tank yesterday and watched the dollars tick upward, I understood why this particular pledge has captured public attention in ways that more complex policy proposals haven’t.
