Province, feds must alleviate 'excruciating' fuel prices: Gas expert

See more Toronto Sun on Google — save as a Preferred Source

Gas price analyst and Canadians for Affordable Energy president Dan McTeague issued a challenge to Ontario Premier Doug Ford and Prime Minister Mark Carney.

"I would call on Ford and Carney to sit down, and get this right, at least temporarily, to alleviate the incredible, excruciating burden fuel prices are putting on Canadians," McTeague told the Toronto Sun.

The federal government suspended the four-cents-per-litre excise tax through January of next year. A two-cent tax comes back online in February, returning to its original four cents on April 1 of next year.

Parliamentary Budget Officer Annette Ryan said said that the total tax pause from an excise pause will save the average family $276 over the course of a year.

"(Removing) four cents a litre is a nothing burger, if there ever was one," McTeague said.

Back in September, Alberta paused its 13-cent provincial fuel tax from Oct. 1 through Dec. 31, and P.E.I. suspended its 8.47% provincial gas tax from Sept. 26 through Jan. 31 next year. The Ontario government hasn't followed suit.

In the one or two seconds it takes to squeeze a litre of gas into a tank, the province pockets nine cents on both gas and diesel. Ontario then takes an additional 8% as part of the 13% HST combined tax for both gas and diesel.

McTeague isn't a fan of the province's double dipping at the pump.

"If you're serious about mitigating the impact gas prices are having on Canadians, and trying to help those who truly need food, who need the heat, who need to eat, then the last thing you want is the federal government and the provincial government bellying up and earning higher prices with their taxes," McTeague said. "And that is exactly what they're doing. It's economically destructive and it doesn't help us."

The cost of regular gas was $1.77.9 per litre on Sunday. On a mid-sized car with a 60-litre tank, the province would pocket approximately $13.90 in tax on a fill. The federal government then comes in and slices about seven cents per litre for Canada's Clean Fuel Regulation (CFR).

According to the Canadian Taxpayers Federation, the CFR will cost up to seven cents per litre of gasoline in 2026, according to analysis from the Parliamentary Budget Officer (PBO). Going forward, the CFR will cost up to 17 cents per litre of gasoline when the regulations are fully implemented in 2030.

The tax will cost the average household between $384 and $1,157 in 2030, depending on the province, according to the PBO. It will cost Canada's economy up to $9 billion by 2030, according to government records.

McTeague would like to see the CFR eased off or removed altogether, calling it a "sneaky" second carbon tax.

The former federal Liberal estimates that 118 million litres of gasoline is consumed per day in Canada.

Diesel was priced at $2.61.9 per litre on Sunday. On a mid-sized commercial truck with a 450-litre tank, the province would pocket about $135 in tax revenue on a fill-up, before including the CFR tax. Some trucks in Canada top 1,000 litres in terms of tank capacity.

"The economic essentials are targeted by high diesel prices," McTeague said. "With gasoline, you have some flexibility. People can choose to carpool, they can choose to take public transportation, where it's available. There are other options. Gasoline isn't as critical to the economy as diesel is and there's no getting around it."

McTeague estimates that Canada consumes about 80 million litres of diesel fuel per day.

But McTeague is dubious about the CFR, especially when it comes to diesel fuel. In his opinion, clean technology isn't going to get goods from one side of the country to the other as efficiently as diesel fuel.

"Our entire infrastructure, planes, trains, trucks, all need diesel," he said. "You can't have a battery-powered, windmill-powered, solar-powered 18-wheeler trying to pull goods that make our economy function."The government says the CFR is an important part of Canada's climate plan "to reduce emissions, accelerate the use of clean technologies and fuels, and support sustainable jobs in a diversified economy."

As an aside, the only fuel that isn't taxed in Canada is dyed diesel, and that doesn't help the average Canadian because it is illegal to use on the roads."It is against the law to use coloured fuel in any motor vehicle that is licensed under the Highway Traffic Act, even if the motor vehicle is operated primarily for farming, construction, forestry or mining business," the government of Ontario said. ganderson@postmedia.com