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June 27, 2007
For immediate release

Cabinet Approves Reduction in Gas Tax

Provincial Treasury

This morning the provincial cabinet met and approved the immediate implementation of a 4.4 cent reduction in provincial tax on gasoline. The reduction will take effect just after midnight tonight.

“This was a key election promise,” says Premier Robert Ghiz, “and we are very pleased to implement it so soon after forming the government. Every Islander has felt the impact of rising fuel costs over the past few years, and we need to do what we can to ease that burden. Although we can’t control the price of gas, we can control gas taxes.

”I believe it is necessary to invest in Islanders whenever possible so that they in turn may have a bit more latitude to invest in their families. This is one of those times,” Mr. Ghiz said.

When the 4.4 cent reduction is implemented at 12:01 a.m. Thursday, June 28, the provincial tax on gasoline will drop from the current rate of 20.2 cents per litre to 15.8 cents per litre. “We will also be capping the tax rate on gasoline, so that there will be no increase in the tax rate when average pump prices exceed $1.00 per litre,” says Provincial Treasurer, Wes Sheridan. “With the new model, the tax will not go higher than 15.8 cents per litre, but it would decrease when the pump price is less than a dollar.”

“Tomorrow morning, Islanders will see a drop at the pumps. Although the Island Regulatory and Appeals Commission allows retailers to price gas within a certain range, I am hoping that the full 4.4 cent savings will be reflected at the pumps,” Mr. Sheridan added.

Media Contact: James Ramsay
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