The stagnation for around fifteen years in revenues derived by Quebec from its tax on fuels creates an underfinancing of its road network that a kilometer tax could correct, suggests a report from the Chair in Taxation and Public Finance of the University of Sherbrooke published Monday. In theory. Because in practice, it gets complicated, the researchers nuance.
The Legault government’s often repeated intention not to increase the tax burden on taxpayers makes life difficult for the idea of reviewing the financing of road infrastructure, but it will have to be done sooner or later to avoid catastrophe, indicate the three study authors (Possibly) replace the fuel tax with a kilometer tax?university researchers Luc Godbout, Jean-Philippe Meloche and Michaël Robert-Angers.
“It is not a continuation of what the government is doing, since it is doing nothing to resolve the problem,” explains to Duty Jean-Philippe Meloche. “Except that the current funding model does not hold up”, both for roads and for public transport. “At some point we will have to start thinking about it. »
The three authors therefore begin this reflection by proposing the gradual establishment of a kilometer tax. It would constitute an adequate alternative to the fuel tax. “This solution stands out among the collection mechanisms available, but it is relatively complex to implement,” they qualify.
They still draw up an implementation schedule in ten stages which would lead to the implementation of this tax during the first half of the 2030 decade, even if they admit that “it will be a fairly long process”.
“The study will perhaps lead a government to at least put in place the first phases,” hopes Luc Godbout, well-known holder of the Chair in Taxation and Public Finance.
$560 more per year
A kilometer tax which would make it possible to replenish the Land Transport Network Fund, allocated to financing the maintenance and development of the road network as well as public transport services, would represent an average annual tax increase of $560 for Quebec motorists. In the report, we also recommend taxing recharges made by electric vehicles at public network terminals, to partly compensate for the fact that they do not pay tax on fuel, since they do not consume any.
The government is still encouraged to adjust a possible mileage tax according to the types of vehicles (light, heavy, electric and gasoline or diesel) so as not to slow down the energy transition necessary to reduce pollution in the transport sector. For example, if it were necessary to reduce the fuel tax as a kilometer tax was imposed, so that this measure was “at zero cost” for motorists, this would make electric vehicles less attractive, since their owners do not pay no fuel tax. For them, it would be an additional tax to bear.
A kilometer tax implemented uniformly throughout Quebec would also end up being more expensive for people living in rural regions or less well served by other means of transportation, and would have a greater impact on people with lower incomes. , add the researchers. Well modulated, it would however make it possible to relieve congestion on busier roads, such as those surrounding city centers during rush hour.
The cost of implementing the technology necessary to calculate this tax is not negligible either. An annual odometer reading, when renewing registration, is the simplest option, although the option of using a GPS system seems to be attractive to other countries around the world. “Collecting data for a kilometer tax is expensive, compared to the fuel tax,” says Michaël Robert-Angers. “Perhaps another solution will change the picture in the future. »
A growing maintenance deficit
Over the years, Quebec has greatly neglected the maintenance of its road network and its public transportation systems. In its most recent Quebec Infrastructure Plan, the Legault government estimated the shortfall needed to repair everything that is wrong with Quebec’s roads at $37.1 billion. This deficit stood at 16.5 billion in 2019.
The study led by Luc Godbout wonders in passing “why the contribution of road network users through the fuel tax has not already been increased”. In doing so, according to him, we would have further encouraged a move towards less energy-consuming vehicles, including electric vehicles, thus contributing to the fight against greenhouse gases (GHG).
Because this duality between users-pays and polluters-pays is one of the elements that most complicates the implementation of a simple universal kilometer tax.
“Quebec road users, whose contribution is insufficient to ensure the maintenance and development of the road network, do not assume all of the environmental and social costs of their GHG emissions, resulting in climate change, or more traffic congestion that they generate,” explains the report. Furthermore, “nothing is specifically planned” to compensate for emissions of fine particles, particularly harmful to human health, nor for noise pollution.
Applying a tax that varies according to the volume of GHG produced by a gasoline engine and by the purchase of a gasoline vehicle would have the effect of discouraging the use of combustion vehicles and other vehicles that would escape a possible tax. kilometer.
Generally speaking, demand for fuel decreases in response to an increase in its price, notes the Chair in Taxation and Public Finance at the University of Sherbrooke. According to her, the solution to bring about a change in behavior would be to tax combustion engine vehicles more heavily, then to offer their owners a reasonable period of time to adopt another form of transport.