Mark Carney Has His Doug Ford Moment

In this morning’s Globe and Mail (April 16, 2026), an article pertaining to high fuel prices makes mention of the opinion of the fiscal affairs chief of the International Monetary Fund, Rodrigo Valdes. He said, “countries should eschew fuel subsidies to help their citizens deal with a shortage of oil and the corresponding surge in energy prices. Targeted, temporary cash transfers that do not mask higher prices would be a far better option.”

Sound familiar?

One of Mark Carny’s first acts as Prime Minister was to kill the Trudeau era carbon levy and rebate cheques. The levy was deeply unpopular because most people couldn’t seem to relate the rebate cheque for the levy (often for more than was actually paid in tax) with the increased cost of fuel owing to the levy.

When you make something more expensive, you’re likely to use less of it. If you’re subsidized to cover that incremental cost, behaviour is changed and the environment (and society) wins.

Except for Pierre Poilievre. His “Axe the Tax” mantra percolated through the zeitgeist and the levy was killed.

Now, with high oil prices, gasoline costs for the average consumer have gone through the roof. Higher prices suggests scarcity. It means people need to reduce their consumption of an expensive good, modifying their behaviour to cope with the increased costs. Drive less, take transit more, move to a more fuel efficient vehicle.

But no. What has Mr. Carney done? He’s cut the federal excise tax on fuel at the pump by 10 cents per litre effective Monday April 20. Cheaper fuel for everyone, right?

Lower income Canadians pay a disproportionate amount of money for fuel and car costs relative to their income. A high income earner, as a percentage, doesn’t pay nearly the same proportionate amount for fuel. The cut to the tax unequally benefits high income earners, rather than lower income families who really need the help. Plus lower prices encourage usage rather than conservation.

This is the point of Mr. Valdes from the IMF. Send a rebate cheque to lower income families, using the existing 10 cents per litre revenue to fund the program. Send little or nothing to high income households. Keep the price high, and modify behaviour when fuel is expensive.

Yes inflation appears to be taking off again. Yes, times are tough. Yes, there is more economic heartache ahead. But personally, I'd prefer to have some air to breathe rather than the alternative.

Australia is rationing fuel. Some areas of the country don’t have any to pump at all. We won’t reach that point because we sell our oil into the U.S. west from Western Canada and we import oil from the eastern U.S. to take care of Eastern Canada. Refining hasn’t been affected by the Iran war. We’ll be just fine, but costs will be high as the world price governs what we pay.

It’s projected that gasoline prices will stay high for the next year. The best thing for everyone would be to keep the price high, reduce consumption and reduce the attendant pollution.

Why has Mr. Carney having his Doug Ford moment? During the run-up of inflation during the pandemic, Mr. Ford reduced the provincial tax on gasoline by 5.7 cents per litre. This cut was made permanent in July of 2025. Again, helping high income earners and of little benefit to low income earners.

So look for gasoline price to go down by 10 cents or so per litre early next week. Then, as the oil companies change over to their summer blends, which they claim are much more expensive to produce, the 10 cent reduction should disappear very quickly. Who loses? Lower income Canadians. Twice. Once from the Federal government, once from the Provincial government.

Well done, all.

Here's a cat who likes the sun.