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Province says dropping carbon tax led to inflation decrease in Sask.

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The Government of Saskatchewan is claiming victory after inflation in the province dropped to 1.9 per cent in January compared to 2.7 per cent in December, according to a recent report from Statistics Canada.

In its update to the Consumer Price Index (CPI), Statistics Canada noted that on a seasonally adjusted monthly basis, the CPI fell 0.1 in Jan. 2024 – marking the first decline in the metric since May of 2020.

All provinces, with the exception of Alberta, recorded a dip in inflation from Dec. 2023 to Jan. 2024 – with the national metric falling from 3.4 per cent to 2.9 per cent.

According to Stats Can, the main upward contributors to the CPI included mortgage interest, rent and electricity costs – while downward contributors included telephone services, gasoline and natural gas costs.

Statistics Canada highlighted that Saskatchewan’s decision to stop collecting the carbon levy contributed to a –26.6 per cent price decrease of natural gas year-over-year in the province.

A fact Crown Investments Minister Dustin Duncan was sure to highlight – using the statistics as an opportunity to attack the federal carbon pricing program.

"If they are actually serious about fighting inflation, the federal government needs to remove the carbon tax on everyone and everything," he said in a news release.

"This shows how much impact it has, just removing it on home heating in one province.”

The Government of Saskatchewan originally announced in October that it would not remit the carbon tax on home heating after the federal government offered an exemption for home heating oil – a move that mainly benefited those in Atlantic Canada.

The province later expanded its decision in late November to include homes utilizing electric heat.

Both of the decisions came into effect on Jan. 1, 2024.

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