Advocates for taxpayers and affordable energy blame the various levels of government in Canada for high gas prices and resultant high inflation, saying that tax relief and promotion of pipelines and the energy sector would alleviate the problem.
In recent days, gas prices reached record highs in most regions of Canada, surpassing $2 per litre. Franco Terrazzano, federal director of the Canadian Taxpayers Federation, says Canadians are feeling the pinch.
“This has been causing a ton of pain for many Canadians, for many families. You go to the gas pumps now and you’ve got to check your bank account to see if you can afford ground beef at the grocery store. Inflation may be the key economic issue facing Canadians, and it’s these high taxes that are making this pain even worse,” Terrazzano said in an interview.
He notes that on average, taxes currently make up about 55 cents per litre of gas, and that will rise to 96 cents per litre by 2030.
“It’s outrageous. And it’s extremely tone-deaf for the government, the feds, to continue raising its carbon tax when people already can’t afford to fuel their cars.”
Terrazzano says governments have the power to relieve gas taxes, especially in places like Montreal, where motorists pay municipal, provincial, and federal taxes.
“You have some major cities where they’re paying six different taxes every time they fuel up in Canada. Up to 38 percent of the pump price comes from taxes. So if politicians tell you they can do nothing, well then they’re not telling you the full story, because they can,” he said, adding that other countries are already providing citizens tax relief during this period.
“The UK just announced tax relief. South Korea cut its gas tax by 30 percent. Germany is cutting taxes on motor fuels. The Netherlands cut its gas tax. You have Italy, Ireland, Israel, India, Peru, Poland. They’re cutting taxes, while Ottawa continues to make our lives more expensive with carbon tax hikes.”
Some provincial politicians have recognized the issue. On the eve of the scheduled annual carbon tax increase, the Saskatchewan NDP called on the ruling Saskatchewan Party to suspend or rebate provincial fuel tax collection from April to June. They were voted down. Next door, the Alberta government gave a 13 cent per litre break on gas or diesel taxes from April through June.
The lead-up to the June 2 provincial election in Ontario had both the Progressive Conservatives and Liberals pledging to lower gas taxes by 5.7 cents per litre. The PCs will implement the temporary tax cut for the final six months of 2022, allowing motorists to keep $1.6 billion more in their pockets.
Dan McTeague, president of Canadians for Affordable Energy, says people are starting to realize that anti-oil policies have stark personal financial consequences for questionable gains.
“This is really about one molecule: carbon,” he told The Epoch Times, noting that Canada’s “miserly contribution” is just 1.5 percent of worldwide carbon emissions.
“I think you’re going to start to lose the public. And I think this is perhaps end game for the greens. They know it because they’re losing. They don’t want to make that connection between affordability and their policies.”
Rebates Fail to Fully Compensate: PBO
In March, the Parliamentary Budget Officer released an analysis on the effects of the federal carbon levy, which rose to $50 per tonne on April 1, but will hit $170 per tonne in 2030. When examining the full scope of the levy’s effects on the four provinces from Alberta to Ontario, the PBO found that rebates did not, and will not, fully compensate people at any quintile of income in any year between 2021 and 2030.
“When losses in economic efficiency are added to fiscal impacts of federal carbon pricing, the net carbon cost increases for all households in Ontario, Manitoba, Saskatchewan and Alberta,” the authors wrote in the highlights of the report.
“We estimate that carbon pricing under HEHE [A Healthy Environment and A Healthy Economy] will reduce the budgetary balance (that is, increase the budgetary deficit) by $0.9 billion in 2021–22 and ultimately by $5.2 billion in 2030–31.”
The analysis found increasingly negative effects on GDP labour incomes and investment as carbon taxes increased.
Higher energy costs inevitably mean a higher cost of living, McTeague says.
“There’s a cause-and-effect relationship between oil prices and the cost of living and our standard of living. They’re all intertwined,” he said.
McTeague says he publicly predicted well over a year ago that gas prices would rise above $2 per litre because supply would not keep up with resurgent demand. He has policy solutions for both the short and long term.
“I’d restructure or build the equivalent of an Energy East and Northern Gateway; I’d punt the bills C-69 and C-48. What’s good in terms of ships coming in [via the] Atlantic should be good for the Pacific as well. I would also probably move very quickly to help consumers in the short term,” he said.
As long as the government sticks to its policy of no pipelines, he adds, it should remove the HST “to allow prices to become a little bit more reasonable … because after all, these high prices are very much a made-in-Canada fact.”
McTeague expects the Liberals will enact the Clean Fuel Standard this summer, something he and Terrazzano both liken to “a second carbon tax.” He says adding more ethanol to fuels will satisfy the Clean Fuel Standard in its initial years, but as it becomes increasingly stricter, it will become an economic drag for oil producers and Canadians.
The former Liberal MP says he wishes the financial burdens of the anti-carbon emission policies could be borne solely by those promoting them.
“ESG [Environmental, Social and Governance] mandates, regulations blocking pipelines, divestment from oil and gas—the whole anti-fossil fuel campaign has done undue harm and intelligible harm to the Canadian economy and to the livelihood and well-being and prosperity of Canadians, and someone has to pay for that,” he says.
“I’d like to say to those green grifters: Maybe you’d like to pay for the trillions of dollars in economic damage you’ve created, because at the end of the day, you’re not saving the planet and I’ve heard this schlock before.”
Follow
Lee Harding is a journalist and think tank researcher based in Saskatchewan, and a contributor to The Epoch Times.
