A one cent per liter increase in the provincial gasoline

A one cent per liter increase in the provincial gasoline tax?

Motorists in Quebec pay around $6 billion in taxes of all kinds on gasoline every year, including $4 billion in the Quebec government's coffers and $2 billion in the federal government's coffers.

The provincial fuel tax alone brings in a whopping $2.1 billion annually for the Quebec government, with the specific tax currently set at 19.2 cents per liter of gasoline.

This special tax is intended to finance investments in the development, improvement and maintenance of our road infrastructure and has not been increased since 2013.

As a result, Quebec's revenues have not been able to keep up with the increase in the cost of maintaining our roads, highways and bridges as a result of inflation.

  • Listen to the economy part with Michel Girard above QUB :

HUNDREDS OF MILLIONS

To correct the situation, Luc Godbout and his colleagues Michaël Robert-Angers, Suzie St-Cerny and Julie S. Gosselin from the Department of Taxation and Public Finance at the University of Sherbrooke propose in their recent memorandum submitted to the Minister of Finance: Eric Girard, the fuel tax the province by 1 cent per liter per year.

“In order to contribute to the financing of the loss-making Land Transport Network Fund (FORT), and from a sustainable development perspective, the fuel tax should be increased by one cent per year,” they specify.

How many years do you suggest? Unless the Quebec government introduces a new user pay replacement measure aimed at forcing motorists to ultimately pay the true cost of road transportation.

I calculated that the proposed fuel tax increase would raise the Quebec government about $110 million more for every 1 cent per liter increase. After a 5th year of increases, this specific tax of 19.2 cents per liter would thus be reduced to 24.2 cents per liter and could raise $500 million more than this year.

  • Listen to the economy part with Michel Girard above QUB :

Toward a growl

If the Legault government moves forward with the proposal to increase the fuel tax by 1 cent per liter per year, we expect a small revolt from motorists who drive gasoline vehicles.

In their defense it must be said that they already pay a lot of taxes when they fill up the tank.

A quick reminder about taxes at the pump. In addition to the provincial fuel tax of 19.2 cents per liter, there is the federal excise tax of 10 cents per liter, the two sales taxes, the provincial QST of 9.975% and the federal GST of 5%, as well as an increase in the state tax of 3 cents per liter of the metropolitan region as a contribution to the financing of local public transport.

At the current price of $1.65 per liter of regular gasoline in Montreal, taxes amount to 53.7 cents and account for almost a third of the bill.

After paying around $6 billion in gasoline taxes at the end of the year, many drivers are fed up with the many taxes levied on gasoline.

ANOTHER SOLUTION

If the Quebec government needs more money to fund our road infrastructure, why doesn't it impose a special provincial tax on the electricity consumption of electric car owners, many are rightly asking. Drivers who drive gasoline cars?

There are currently around 140,000 electric vehicles in circulation in Quebec. The government wants this number to rise to two million by 2030.

As far as we know, electric cars are just as “harmful” to road infrastructure as gasoline cars. So under what privilege do electric vehicle owners absolutely not contribute to the funding of the Land Transport Network Fund (FORT)?

There is no point in granting this privilege!

If Quebec is so interested in padding FORT's coffers, all it needs to do is impose a specific tax on electricity used by electric vehicles, equal to the province's fuel tax.

Last point.