CTA challenges government suggestion to raise fuel tax

OTTAWA, (March 2, 2004) — The Canadian Trucking Alliance if fuming over recent comments made by Federal Environment Minister David Anderson who suggested that the government is giving consideration to raising the federal excise taxes on fuel.

The minister was recently quoted as saying that increasing the excise taxes on fuel to reduce consumption and emissions should be analyzed, adding that the debate over whether taxes should increased has been stymied by special interest groups.

“I doubt the average taxpayer wants to see higher fuel taxes any more than businesses do,” CTA CEO David Bradley,” said in response.

Bradley wondered why the government would seek to pursue the issue yet again, when its own report concluded that raising federal fuel excise tax is not the best approach for pursuing environmental initiatives.

“The tax base is not closely related to the causes of urban air pollution; neither is the tax base well designed from the perspective of climate change,” stated the 1998 Report of the Technical Committee on Business Taxation, prepared for then finance minister Paul Martin. “It would be appropriate to consider broader based taxes on pollutants from a wide variety of sources.”

Bradley also criticized Anderson for reportedly hinting that taxpayers would prefer to paid more excise tax and less income tax. But, says Bradley, “since there is only one taxpayer, I suppose at the end of the day it matters less to an individual how he pays tax, so long as he does not pay more in combined tax. Regardless, I find it hard to fathom how replacing a progressive income tax with a regressive excise tax would be a good thing.”

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