Ontario Budget Cuts Fuel Taxes, Adds Fertility Credit

Summary#

• Bill 24 is Ontario’s 2025 budget bill. It changes many laws at once.
• The bill lowers some fuel and alcohol taxes, creates a new fertility treatment tax credit, bans municipal road tolls, and sets new rules for traffic cameras and bike lanes in Toronto. It also raises penalties for illegal tobacco and for breaking securities laws.

Key changes

• Fuel taxes: Sets gasoline and diesel tax at 9 cents per litre starting July 1, 2025. Ends provincial tax on propane.
• Family support: Creates a refundable Ontario fertility treatment tax credit worth 25% of eligible costs, up to $5,000 per year, for expenses after Dec. 31, 2024.
• Alcohol: Cuts the spirits tax at distillery retail stores by half (61.5% to 30.75%) on Aug. 1, 2025; updates beer taxes and small-brewer rules; allows alternate rates for coolers and hard seltzers.
• Roads: Bans municipal road tolls province‑wide and blocks Toronto from adding a vehicle‑permit tax. Requires the province to restore a lane for cars on parts of Bloor St., University Ave., Avenue Road (including Queen’s Park Crescents), and Yonge St. by reconfiguring bike lanes.
• Cameras: Cities must publish speed‑camera and red‑light camera locations and may have to post signs. Contracts can’t pay camera vendors per ticket. The province can direct how systems operate.
• Markets and enforcement: Doubles top fines for securities and commodity‑law offences to $10 million; raises administrative penalties to $5 million; gives CIRO (the investment industry regulator) formal investigation powers. Increases fines for illegal tobacco and adds new large‑quantity offences.
• Other: Lets government send more tax and property assessment notices by email, creates a historical parks fund, tightens oversight of the cannabis retail corporation, and authorizes up to $27 billion in provincial borrowing.

What it means for you#

• Drivers and commuters

  • Gas and diesel taxes set at 9¢/L as of July 1, 2025. Propane no longer taxed under the Gasoline Tax Act.
  • No new city road tolls anywhere in Ontario. Toronto is also blocked from adding a vehicle‑permit tax.
  • In Toronto, one lane on parts of Bloor, University, Avenue Road (including Queen’s Park Crescents), and Yonge will be restored for cars by reconfiguring existing bike lanes.
  • Cities must post where speed and red‑light cameras are located and may have to add warning signs. The province can require changes to how these systems run.

• Families seeking fertility care

  • New refundable credit: 25% of eligible fertility treatment costs, up to $5,000 per year.
  • Applies to expenses paid after Dec. 31, 2024, for services provided in Canada, and not reimbursed by insurance.
  • Either spouse can claim, but only one credit per couple per year.

• Shoppers and producers of alcohol

  • Spirits bought at distillery retail stores may cost less after Aug. 1, 2025, due to a lower tax rate.
  • Beer tax rules for microbrewers change; the small beer manufacturers’ tax credit is updated. Prices for some craft beer could change.
  • The government can set alternate tax rates for coolers and hard seltzers (up to 7.1% alcohol), which could change prices.

• Smokers and retailers

  • Much higher fines for illegal tobacco. New offences for holding very large quantities, with possible jail time.

• Investors and financial firms

  • Higher fines (up to $10 million) and penalties (up to $5 million) for breaking securities and commodity‑futures laws.
  • CIRO investigators get clear powers to compel documents and testimony. Most retail investors won’t notice changes unless involved in misconduct.

• Property owners and employers

  • Property assessment and Employer Health Tax notices can be sent electronically.
  • Assessment rules clarify when and how notices are provided; data‑sharing rules are updated.

• Municipalities

  • No authority to toll roads. New limits and duties on automated camera enforcement (publish locations, possible signage, no per‑ticket vendor pay). The province can set criteria for “community safety zones.”

• Park users

  • A new Historical Parks Account may help track funding for historical parks. Day‑to‑day park use is unchanged.

Expenses#

Estimated budget impact: No publicly available information.

• The bill lowers some provincial tax rates (gasoline, diesel, spirits at distilleries) and adds a new refundable fertility tax credit, which reduce provincial revenue.
• It raises fines for illegal tobacco and capital‑markets offences, which could increase revenue if enforced.
• It removes potential municipal revenue tools (no tolls; limits on a Toronto vehicle‑permit tax).
• It authorizes up to $27 billion in provincial borrowing through the Ontario Loan Act, 2025.

Proponents' View#

• Helps with affordability by keeping fuel taxes lower and cutting certain alcohol taxes.
• Supports family building with a refundable fertility treatment tax credit.
• Improves road safety transparency by publishing camera locations and adding signage, while banning per‑ticket vendor deals.
• Eases congestion in Toronto by restoring a lane for cars on key streets and preventing local road tolls.
• Cracks down on illegal tobacco and financial misconduct with stronger penalties and better investigative tools.
• Modernizes government service by allowing electronic notices and clearer rules.

Opponents' View#

• Undercuts municipal control: bans local tolls, limits Toronto’s options, and lets the province override cities on bike lanes and camera operations.
• Reconfiguring bike lanes may reduce cycling safety and reverse progress on active transportation.
• Fuel tax cuts may conflict with climate goals and reduce funds available for public services.
• Alcohol tax cuts could increase consumption‑related harms; benefits may be uneven.
• The fertility credit may mainly help those who can already afford costly treatments, and administration could be complex.
• Borrowing authority of up to $27 billion raises concerns about provincial debt levels.