Advocates call on governments to cut gas taxes amid high costs
Posted Mar 12, 2022 10:10:00 PM.
Some consumer advocates are calling on governments to cut fuel taxes as gas prices around the world continue climbing following Russia's invasion of Ukraine.
“Governments are getting really fast at trying to say that they have no responsibility for the recent increase in prices, and that's true,” the Canadian Taxpayers Federation's Renaud Brossard said. “But they have their fair share of responsibility for the fact that prices are this high.”
When motorists go to fill up on gas in the Maritimes, they pay between 47 and 53 cents per litre in tax. That's made up of several different taxes, including a provincial gas tax, which is 15.5 cents per litre in Nova Scotia.
“Can governments do something to help motorists? Or course,” Brossard, who's the advocacy group's interim Atlantic director, said. “They could take a little bit less and leave more money in people's pockets.
“One thing they could do is at least pause the collection of one of those taxes. That's exactly what Premier Jason Kenney did in Alberta.”
On March 7, Alberta's premier announced the province's 13-cent per litre tax on gasoline and diesel would be suspended starting April 1. On top of that, the province made plans to deliver a flat $150 rebate on electricity bills to nearly all homes and businesses to offset the high costs seen in 2022.
Combined, that'll save Alberta consumers a total of $1.3 billion on fuel and provide $300 million in electricity rebates.
“I don't know about you, but if I could pay $1.73 instead of $1.86 for gas, that would fairly be a welcome change,” Brossard told The Todd Veinotte Show earlier this week. “That's something that Premier Tim Houston could look at, whether to stop the collection or, at least, to reduce the collection.
“There's definitely some margin for the government to reduce that intake.”
On Saturday, gas prices in Nova Scotia saw a slight dip, dropping nearly 10 cents per litre as the province's utility review board invoked the interrupter clause. For regular gasoline, the price dropped from 182.1 cents per litre to 172.3 cents.
Another option Brossard said governments could consider is to stop charging “taxes on taxes.”
Currently, the price of gas includes multiple taxes such as a federal, provincial and carbon tax. Then, HST is added on top of that total.
“There's a lot of ways governments can look at reducing this intake,” Brossard said. “Every time the gas price goes up, the government's revenue goes up, as well. They could at least offer some of that money back to consumers by reducing the tax.”
However, cutting out a tax isn't as simple as signing a form or clicking a button. For one, governments rely on taxes to operate.
“Of course, we do need some,” Brossard said. “But right now, if you look at it, people are hurting. People are seeing the price of everything go up fast.
“The fact is, the price of everything is going up — and paycheques have not followed. So people have less money, they're able to purchase less stuff.”