VICTORIA: The Canadian Taxpayers Federation (CTF) reacted to Premier Gordon Campbell's televised address to British Columbians.

Gas Taxes
The CTF is alarmed over the impact of a 3.5 cent per litre gas tax hike on BC motorists and businesses. It was only last week that the CTF wrote to the BC government to call for a cut to the 1.25 cent per litre gas tax collected to subsidize BC Ferries.

"Instead of hiking gas taxes, the BC Liberals should lock arms with other provincial governments to press Ottawa for a share of the federal government's gas tax revenues. Ottawa is a dead-beat tax collector that spends only a fraction - 2.4% - of its $5 billion in annual gas tax revenues on roads, 99% of which is spent east of the Ontario border," said Victor Vrsnik, BC director for the Canadian Taxpayers Federation.

"At a minimum, any gas tax hike should be offset by a broad-based tax cut in the upcomimg provincial budget so that British Columbians are no further behind."

Sunset Clause
The CTF is acknowledges the value of the province dedicating the new gas tax hike to road renewal, but expects the province to cushion the blow with a sunset clause.

"Dedicating gas taxes to specific infrastructure projects is fine and well. But the corollary to a dedicated gas tax is to repeal it once the cost of those projects are paid for and complete," said Vrsnik. "The BC Liberals should not follow in federal Liberal shoes. Ottawa introduced a 1.5 cent per litre gas tax in 1995 to reduce the deficit. The deficit was eliminated six years ago but the tax remains."

BC Rail
The CTF gives the thumbs up to the government for adopting the CTF's repeated recommendation to restructure BC Rail under the auspices of a private sector operator and investor.

"BC Rail's current operating model as a crown corporation has outlasted its usefulness. BC Rail has over a $600 million debt on its books; it posted a $107 million deficit last year; and it is short on resources for upgrades as it lacks economies of scale to curb costs and post profits."

"Partnering BC Rail with a class-one railway company like Canadian National or Canadian Pacific would release the government from potential liabilities and would clear the way for a new railway company to deliver improved and cost effective services for freight and passenger services in British Columbia, " recommended Vrsnik.