CTA urges feds to scrap diesel tax

OTTAWA — The Canadian Trucking Alliance is urging the federal government to remove the federal excise tax and give truckers a desperately needed break.

In a letter from CTA chief David Bradley to Prime Minister Stephen Harper, Bradley informed the federal government of the dire situation facing the trucking industry and the need for some relief.

“I think it is important to remind you that taxes on commercial fuel distort the marketplace and I wish to disavow you of the notion that even moderate tax relief would not be helpful in the current situation confronting many Canadian truckers; it would,” Bradley wrote. “Regardless, there are some long-standing tax policy issues concerning the taxation of commercial diesel fuel in Canada that warrant attention and have been begging for resolution for a considerable period of time.”

As the price of oil continues to hit record high prices on a seemingly daily basis, the price of diesel in Canada is also rising steadily.

Over the last few weeks, the Canadian average has risen from about $1.25 a liter to $1.45 this week. In the Maritimes, diesel has pushed past $1.60 a liter in some remote areas, while much of Quebec is approaching the buck 60 mark. In southern Ontario prices hover between $1.40 and $1.45, while in urban Alberta diesel pumps read around $1.35 a liter.

Currently, commercial road diesel fuel is subject to a four cent per liter federal excise tax.


During the past few months, the cost of diesel fuel has overtaken labor costs as the number one operating cost for many if not most truck fleets.

“With pump prices for commercial diesel fuel at record highs, elimination of the four cent per liter federal excise tax on diesel fuel, for example, would provide price relief of about 3 percent at today’s prices,” said Bradley in his letter. “That may not seem like much but it translates into a saving of just over 2 cents per mile in many operations. I can tell you that there are many hard-pressed Canadian truckers today who are not earning anywhere near a profit of 2 cents per mile.”

“Truckers feel they are being gouged not only by the escalating price of diesel fuel but by the added combination of federal and provincial fuel taxes,” Bradley concluded. “I would ask that you give serious consideration as to whether the taxation of commercial diesel fuel via excise taxes still makes sense in this day and age. I believe that the inescapable conclusion is that it does not.”

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