Quebec urged to temporarily reduce gasoline taxes

(Montreal) The Canadian Taxpayers Federation (CTF) is calling on the Quebec government to follow the lead of certain provinces and temporarily lower its fuel tax to give motorists a break.




The organization that fights for lower taxes made public its 26e annual report on “tax transparency at the pump”.

According to its ranking, Quebec ranks fifth among Canadian provinces in terms of gasoline prices, with an average price of $1.75 per litre. First place is occupied by Newfoundland and Labrador, at $1.86.

As for the tax share, it represents 38% of the total bill at the pump in Quebec, according to FCC calculations. This proportion includes the various provincial and federal taxes, including the carbon tax under the Quebec Cap-and-Trade System for Emissions Allowances (SPEDE), which is 12.5 cents per litre, the report indicates.

La Belle Province thus comes in third position, behind Nova Scotia and British Columbia (excluding Vancouver and Victoria), their tax share being each 40%.

The CAQ government showed openness by announcing in the spring its intention to abolish the floor price on gasoline, believes the director for Quebec at the FCC, Nicolas Gagnon.

“The government of François Legault recognizes that the price is essentially too high on gasoline,” said Mr. Gagnon at a press conference in front of a gas station on De Maisonneuve Boulevard East in Montreal.

Mr. Gagnon asks Quebec to continue its efforts and to draw inspiration from its Canadian neighbours in order to ease the financial burden on Quebec motorists in the current economic context.

“We know that in other provinces, notably Manitoba, Ontario and Newfoundland and Labrador, the premiers have offered breaks on gasoline. […] “That’s hundreds of dollars saved simply by reducing provincial gasoline taxes by a few cents,” said Mr. Gagnon.

The Quebec representative of the FCC would like the government to reduce its fuel tax by about half for a period of a few months. It amounts to 19.2 cents/litre. It brings in about 2 billion annually to the Quebec government coffers.

“A spending problem”

The FCC’s proposal goes against the demands of the province’s cities. Last May, the Union des municipalités du Québec called on the Legault government to index the cost of registrations and fuel taxes, in order to better finance public transit in particular.

Mr. Gagnon is instead calling for a clean-up of the finances surrounding public transport.

If we look at municipal finances or public finances in general, we notice that it is not a revenue problem, but a spending problem. So, we need to review that first, before passing on an additional burden to Quebec families who have to take their vehicles every day to go to work or to the grocery store.

Nicolas Gagnon, Director of the Canadian Taxpayers Federation

The fuel tax rate has remained unchanged since April 2013. Revenue from this tax is paid into the Land Transportation Network Fund (FORT), which helps finance the road network and public transport.

According to a report by the Institute for Research in Contemporary Economics, published last year, the FORT suffers from a “structural problem” because its main source of funding is at a ceiling. Its author mentioned a possible decline in revenues from the fuel tax in the coming years, “due to the improvement in the energy performance of vehicles and their electrification.”


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