OTTAWA — Liberal leader Stephane Dion may have tried to soften the blow to truckers worried about his national carbon tax plan, but Canada’s leading trucking advocate says the reforms don’t go far enough to mitigate the financial sting of higher diesel prices resulting from Dion’s Green Shift plan.

After saying last month the trucking industry would be able to cope with his carbon tax on diesel fuel and other energy sources, Dion backpedaled slightly at a Liberal caucus meeting in Winnipeg, announcing up to $250 million over four years to help the fisheries and trucking sector invest in low emissions, "green" technologies.

It also promises $400 million in emission-reduction credits to forestry companies; and $250-million for a "green farms fund" to offer farmers rebates on technologies that will cut fuel consumption and greenhouse-gas emissions.

David Bradley, CEO of the Canadian Trucking Alliance, says the cash is a good start but does nothing to mitigate the impact of Green Shift for thousands of carriers that are already environmentally-conscious.

The CTA says Dion’s carbon tax will still
hurt truckers, despite small funding package.

"The trucking industry is already making the shift to smog-free engines, ultra-low sulphur diesel fuel and proven and available GHG busting technologies and devices," he said. “What we need is a rebate program to accelerate the investment, especially during these tough economic times."

Bradley says that it is not clear whether the fund announced would be used for rebates or distributed some other way. "When the Liberal proposal is looked at over four years and spread across all the freight modes and the fisheries industry it is unclear how much will really be available for the trucking industry."

He notes that the trucking industry is currently paying over $280 million a year in federal excise tax on diesel fuel — "a form of taxation which is archaic and regressive and should have been repealed or reformed years ago."

If the Green Shift plan adds another 7 cents per liter to the cost of diesel fuel, the additional tax paid by the trucking industry would be close to $500 million per year, says CTA. "We still end up paying significantly more tax at a time when the industry is suffering from higher fuel costs, the appreciation of the Canadian dollar, border delays and a freight recession in both the United States and parts of Canada.

"Not to mention that trucks are responsible for the distribution of 90 percent of the country’s consumer products and foodstuffs as well as two-thirds of our trade with the U.S.," says Bradley.

Bradley points out the railways, which are significantly more profitable than the trucking sector, was already granted accelerated capital cost allowances in the last federal budget to help them adjust to emission regulation similar to that which already exists in trucking, but which will not come into force until 2012.

"But today’s announcement from the Liberal leader is silent on whether trucking CCA rates would be adjusted accordingly. Still … the CCA rate acceleration is really only of help if you are generating a profit and most trucking companies at best are earning razor thin margins these days."