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News
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How high will gas prices go before government is prepared
to step in and reduce taxes? September 1, 2005
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Opposition Leader Gerry Reid is asking Finance Minister Loyola Sullivan how
high gas prices will go before government is willing to step in and cap or
reduce the 16.5 cent per litre provincial gas tax it receives or remove the
HST charged to gasoline, a tax that generates more profits as the price of
gas increases. It is predicted that the price of gas could jump as much as
20 to 25 cents per litre as early as this weekend. "Minister Sullivan continues to provide false excuses as to why he is not willing to sacrifice the profits he is making from gasoline taxes," said Mr. Reid. "Over the past few weeks, Minister Sullivan has provided three different excuses as to why he cannot reduce gasoline taxes or the HST charged on each litre. First, the minister stated that government was not making any money because the gasoline tax was a fixed tax charged per litre. He stopped using this excuse when it was pointed out that each time the price of gas goes up, government makes higher profits from the HST. Second, he said he couldn’t remove the HST because he needed the approval of other Atlantic provinces and the federal government. He stopped using this excuse when Nova Scotia indicated they wanted permission from this province to remove the HST from their gasoline taxes. Minister Sullivan stated he is not willing to give that permission. Now, the most recent excuse is that consumption is down. I suggest Minister Sullivan ask taxi drivers, truck drivers and low income families whether or not their consumption is down. "This government is full of excuses, but empty on action. The price of gasoline is expected to climb another 20 to 25 cents per litre in the coming days. With this increase, government will make another 4 cents per litre in profits from the HST. If the average consumer puts 25 litres of gas in their car, the provincial and federal governments will make an extra dollar per person. This amount continues to add up, realizing that the price of gas has increased dramatically over the past several weeks. This amount of money doesn’t include the other 27 cents of provincial and federal gas tax charged to every litre of gasoline. If government did not charge any taxes to a litre of gasoline, the price of gas in this province would average 70 cents per litre. This figure should make Minister Sullivan think twice about collecting these increasing tax revenues on the backs of Newfoundlanders and Labradorians."
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