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Relief at the Pumps - Who will step up for Ontario Taxpayers

Author: Neil Desai 2006/08/23
With gas prices well above a dollar a litre around the province this summer, consumers are wondering if they can expect any sort of reprieve at the pumps.

Relief is possible and Ontarians should look no further than Queen's Park: The provincial government collects 14.7 cents in taxes for every liter of gas sold. This is in addition to the federal excise tax of 10 cents a litre and 6 per cent GST, which is applied to the retail price of fuel as well as the provincial and federal levies. Taxes account for 30.9 per cent of the total Ontario pump price - It is highway robbery.

Every year the province of Ontario collects approximately $3- billion in fuel tax revenues. It is a cash cow as the revenues flows into general revenues and are not dedicated to road maintenance. The province of Ontario is decreasing the amount of spending on road construction and maintenance while their gas tax revenues continue to soar. According to the Ontario Ministry of Transport, the provincial government will decrease spending on infrastructure as a percentage of gas tax revenues from 54.7 per cent in 2005-06 to 47.8 per cent in 2006-07. This will amount to a $300-million decrease in spending on new roads and maintenance this fiscal year.

The Ontario government not only has the luxury of increased gas tax revenues, and less spending commitments, they also have a federal government commitment to increase gas tax revenues geared towards provincial and municipal infrastructure. Ontario's share of Ottawa's five-year $5-billion gas tax transfer deal to the provinces is $1.85-billion.

It is high time for an overhaul of Ontario's gas tax take. Premier Dalton McGuinty and his Liberal government should table legislation dedicating gas tax revenues to road maintenance, as Manitoba has done. And to provide some relief to motorists the province should cut its gas tax.

Political leaders from both major parties in New Brunswick have realized that gas taxes are a major burden on Canadians. They are doing something to alleviate it. Liberal leader Shawn Graham has pledged to cut the province's gas tax by 3.8 cents a litre should his party form the next government. Premier Bernard Lord responded with a commitment to drop the tax by 4.5 cent should his Progressive Conservative Party retain power. These commitments come at a time when the province is spending 124.5 per cent of its gas tax revenues on transportation infrastructure.

Lower gas taxes are a priority for voters in the maritime province. And whichever party wins the election on Sept. 18, motorists there will enjoy the second lowest provincial fuel taxes in Canada (Alberta has the lowest tax at 9 cents a litre).

Elections are a good time for politicians to get in tune with the needs of taxpayers. An election is a year away in Ontario: Spending on roads is down, gas tax revenues are up, and taxes are too high. Does this sound like a winning election strategy

Liberal Premier Dalton McGuinty, Opposition Conservative Leader John Tory and NDP Leader Howard Hampton all have the same opportunity to pledge a decrease in the provincial gas tax. Who will step up for Ontario taxpayers and give them the relief at the pumps they crave

The campaign for a cut to Ontario's gas tax has commenced.



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