As reported by CAA-QUÉBEC
Quebec – While it agrees on the need to attack the deficit, which is a collective responsibility, CAA-Quebec is disappointed by the government’s recent budget decision to impose a fuel tax increase on motorists, who are already heavily taxed. This tax hike, amounting to 4 cents per litre over four years, only increases the burden on motorists. Moreover, the new Fonds des infrastructures routières et de transport en commun (FORT, or road and public-transit infrastructure fund) does not “lock in” the additional amounts needed, and there are no true concrete incentives to adopt greener driving habits.
Impact of the planned increases
The increase in the gasoline tax of 1 cent/litre per year, spread over four years—and, incidentally, also subject to the coming increases in the Quebec sales tax—means motorists will eventually pay about 6.5 cents/litre more at the pump. On top of this, since the government has granted permission to the metropolitan regions of Montreal and Quebec City to levy an additional surtax of 1.5 cents/litre to fund public transit, the overall impact on consumers in those regions could be an increase of more than 8.0 cents/ litre by April 1, 2013.
Still no true “locked in” fund for roads
Although the government has announced it will create an accounting unit for the new FORT, separate from the consolidated fund, where revenues from automobile taxes will be deposited directly, it has made sure the latter fund remains within its overall reporting environment, which means there is no guarantee for the future that these amounts will be sustainably reinvested in our road network. This does little to reassure the people who will be forced to pay the higher amounts.
One fund, one payer, two purposes
CAA-Quebec also deplores the fundamental nature of the FORT, that is, the fact that amounts deposited in this fund will be used to invest both in the road network and in public transit. Moreover, since the FORT will be paid for exclusively by motorists—via the fuel tax as well as vehicle registration and driver’s licence fees—it will probably be difficult for this consumer group to ascertain to what extent their investment will actually remain aligned with road infrastructure upgrades and maintenance in the future.
That being said, there are other funds available for public transit. Approximately $120 million of the $200 million in the government’s Green Fund, amassed using the carbon tax levied on oil companies (but which in fact is, once again, largely passed on to motorists), is already earmarked for public transit every year. That’s not counting the amounts remitted to the Agence métropolitaine de transport, collected via the 1.5 cents/litre Montreal gasoline surtax—which will double in 2010, reaching $106 million. How does the government plan to take all of these other contributions into account when it is asking motorists to pay an even larger share of the funds for public transit, by bringing in the FORT?
Quebec – While it agrees on the need to attack the deficit, which is a collective responsibility, CAA-Quebec is disappointed by the government’s recent budget decision to impose a fuel tax increase on motorists, who are already heavily taxed. This tax hike, amounting to 4 cents per litre over four years, only increases the burden on motorists. Moreover, the new Fonds des infrastructures routières et de transport en commun (FORT, or road and public-transit infrastructure fund) does not “lock in” the additional amounts needed, and there are no true concrete incentives to adopt greener driving habits.
Impact of the planned increases
The increase in the gasoline tax of 1 cent/litre per year, spread over four years—and, incidentally, also subject to the coming increases in the Quebec sales tax—means motorists will eventually pay about 6.5 cents/litre more at the pump. On top of this, since the government has granted permission to the metropolitan regions of Montreal and Quebec City to levy an additional surtax of 1.5 cents/litre to fund public transit, the overall impact on consumers in those regions could be an increase of more than 8.0 cents/ litre by April 1, 2013.
| |
| Photo: Jupiter Images |
Still no true “locked in” fund for roads
Although the government has announced it will create an accounting unit for the new FORT, separate from the consolidated fund, where revenues from automobile taxes will be deposited directly, it has made sure the latter fund remains within its overall reporting environment, which means there is no guarantee for the future that these amounts will be sustainably reinvested in our road network. This does little to reassure the people who will be forced to pay the higher amounts.
One fund, one payer, two purposes
CAA-Quebec also deplores the fundamental nature of the FORT, that is, the fact that amounts deposited in this fund will be used to invest both in the road network and in public transit. Moreover, since the FORT will be paid for exclusively by motorists—via the fuel tax as well as vehicle registration and driver’s licence fees—it will probably be difficult for this consumer group to ascertain to what extent their investment will actually remain aligned with road infrastructure upgrades and maintenance in the future.
That being said, there are other funds available for public transit. Approximately $120 million of the $200 million in the government’s Green Fund, amassed using the carbon tax levied on oil companies (but which in fact is, once again, largely passed on to motorists), is already earmarked for public transit every year. That’s not counting the amounts remitted to the Agence métropolitaine de transport, collected via the 1.5 cents/litre Montreal gasoline surtax—which will double in 2010, reaching $106 million. How does the government plan to take all of these other contributions into account when it is asking motorists to pay an even larger share of the funds for public transit, by bringing in the FORT?