Quebec can make gas more affordable, using the Green Fund surplus as a start, says the MEI

Montreal, November 13, 2025 – The Quebec government recently tabled Bill 7, which aims to streamline bureaucracy and make government more efficient, but is also an opportunity to reduce prices at the pump, says the MEI in a report released today.

“For Canadians across the country, Ottawa’s decision to abandon the consumer carbon tax means lower prices at the pump, everywhere except Quebec,” says Gabriel Giguère, senior policy analyst at the MEI and author of the report. “The Legault government has a real opportunity to make life more affordable for Quebecers.”

The new bill introduced in November gives the Quebec government more flexibility over its fuel tax policy. It has indicated it could either use the $1.8-billion surplus in the Green Fund 2.0 to lower the 19.2-cent fuel tax or transfer this money to the Generations Fund.

Quebec drivers face some of the highest gasoline prices in Canada. The province currently applies several different taxes on fuel (on top of the costs from its carbon market), which inflate pump prices and make driving significantly more expensive than elsewhere in the country.

The gap became even more pronounced after Ottawa temporarily suspended its consumer carbon tax in an effort to address the rising cost of living, which the 2025 budget has just made permanent. This measure, however, does not apply to Quebec, which operates its own carbon pricing mechanism.

Today, the gap between gas prices in Quebec and the rest of Canada has widened considerably.

In March 2025, before Ottawa’s suspension of the federal consumer carbon tax, the price of gas in Montreal was just 3.7 cents higher than the national average. By September, that gap had grown to 18 cents, nearly five times greater.

In Quebec City, prices went from 0.8 cents below the national average to 14.6 cents above.

Filling a 55-litre RAV4 tank now costs about $10 more in Montreal than the Canadian average, and nearly $13 more than in Toronto. On a yearly basis, an SUV owner pays roughly $260 more than the Canadian average in Montreal, and $187 more in Quebec City. (A portion of the difference is due to the additional three-cent tax that is applied in Greater Montreal.)

“Using the Green Fund surplus to reduce gas prices would be a step in the right direction, but we should go even further,” says Mr. Giguere. “Quebecers are being punished by the inaction of this government. Why should it cost hundreds of dollars more to get around in Quebec than it does elsewhere in Canada?”

The MEI Viewpoint is available here.

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The MEI is an independent public policy think tank with offices in Montreal, Ottawa, and Calgary. Through its publications, media appearances, and advisory services to policymakers, the MEI stimulates public policy debate and reforms based on sound economics and entrepreneurship.

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