OTTAWA, ON: As Canadian motorists fill up their tanks this May long weekend, marking the traditional launch to the summer driving season, the Canadian Taxpayers Federation (CTF) is calling on the Harper government to scrap the 1.5 cents-per-litre federal “deficit elimination” gas tax and end the practice of taxing tax.
The CTF sent an open letter to four federal party leaders today, demanding that if the budget is balanced as expected, Ottawa keep its hands off the $606 million in ‘deficit elimination tax’ it plans to collect this year, and give it back to Canadian drivers.
“We’ve suffered with this penny-and-a-half per litre rip-off for nearly 20 years now,” said CTF Federal Director Gregory Thomas. “The Harper government is projecting a surplus. Why do they need $606 million in deficit reduction tax?”
Canadians kept paying the deficit reduction gas tax, first introduced in 1995 by the Chrétien government, all the way through 11 surplus budgets between 1996 and 2007 when Ottawa racked up $105 billion in total surplus. By the end of the current fiscal year, with another surplus expected, Canadians will have paid a total of $11.4 billion in deficit reduction gas taxes.
Ottawa also charges GST or HST on the federal and provincial excise taxes added to the price at the pump – charging tax on a tax – a practice that costs anywhere from a penny a litre in Alberta to a nickel a litre in Montreal, billing Canadian drivers $1.5 billion this year.
In 2004, as Leader of the Opposition, Stephen Harper said "the fastest and easiest way to give Canadians relief at the pump is for the federal government to stop charging GST on top of gasoline excise taxes. It's time to axe the tax on the tax."
“Canadians are paying 30 per cent of the price at the pump in gas taxes in Toronto,” said Thomas, “31 per cent in Halifax, 33 per cent in Vancouver, and 35 per cent in Montreal. It’s highway robbery in the truest sense of the word.”
“You pay $10 more in gas tax to fill up your tank in Ontario than you do in Alberta, $12 more in Nova Scotia, $15 more in Vancouver, and $16 more in Montreal,” said Thomas. “But the pre-tax price of the fuel is actually lower in all those places than it is in Alberta. Politicians are milking the fuel pumps like a cash cow and it’s time they stopped.”
The complete Canadian Taxpayers Federation report with effective tax rates in gasoline across Canada is available for free download here.
To read the Gas Tax Honesty Day Report, click HERE
To read the letter to Prime Minister Stephen Harper, click HERE
To read the letter to Thomas Mulcair, click HERE
To read the letter to Elizabeth May, click HERE
To read the letter to Justin Trudeau, click HERE
Gregory Thomas, Federal Director
