Labour Day weekend usually means a lot of road travel for Canadians. So you're probably going to fill up your tank a few times and pay through the teeth.

While some politicians and consumers blame the oil companies for price collusion, they miss the more obvious target. The main reason for high gas prices is high gas taxes, plain and simple.

In July 1998, the average retail cost of a litre of regular gas in Canada was 53.0 cents. From this price, 24.4 cents covered the cost of delivering the fuel from the ground to your tank. This includes refining costs of 6.6 cents; the marketing and retail margin was 5.3 cents; and crude oil costs were 12.5 cents per litre. The rest, 28.6 cents per litre, went to the federal and provincial governments in the form of taxes.

The feds and the provinces divide the spoils of gas tax haphazardly. Provincial taxes vary from 16.5 cents per litre in Newfoundland to nine cents in Alberta. The feds then siphon of another 10 cents per litre of regular gas plus the dreaded GST.

Motorists in Newfoundland, New Brunswick and Nova Scotia paid the price when they replaced the GST and PST with the 15% Harmonized Sales Tax. Now they are paying an extra 8% more at the pumps than the rest of the country. Just one more reason to be fearful of Ottawa's ambitions to centralize tax collection.

The federal and provincial gas taxes do not even include all the indirect taxes the oil companies and service providers pay, such as business tax, property tax, corporate income tax, payroll taxes, GST Sales tax, etc.

A study of the evolution of gasoline prices in Canada by StatsCan economists Marc Prud'homme and Klaus Kostenbauer shows that the price of gas itself, once adjusted for inflation, fell by 26% between 1957 and 1995.

Compare July 1998's 53-cent pump price to 9.5 cents per litre in 1957. Once adjusted for inflation, the 1957 pump price is actually 56.6 cents per litre. In other words, the price of gas in constant dollars has remained steady and even dropped a bit.

In 1957, taxes averaged slightly less than 2.8 cents for every 9.5 cents Canadians paid on a litre of gas, or 29% of the price. In 1998, when a litre costs 53 cents, 28.4 cents - 54% of the total - went to Ottawa and the provinces. That's an 86% increase in gas taxes since 1957.

Fuel taxes continue to rise in Canada while highway expenditures languish behind. Every year, Canadians pay over $5 billion in federal fuel taxes and Ottawa returns only 5% to the provinces for highway spending. Meanwhile the provinces shoulder the burden and spend over 60% of their share of road-user taxes on highway development.

In their purest form, gas taxes are a road user fee that should be spent on improving our highways network. As a user fee, gas taxes should not be used for general operating revenue. The policy implications are evident. Ottawa and the provinces should reduce gas taxes to levels commensurate with road development only.

Even this year's federal committee Report on Gasoline Pricing recommends that provincial governments dedicate gas taxes and vehicle fees for road repair and transportation infrastructure.

Punishing gas taxes only compound the problem of having to replace your front axle after hitting that crater of a pothole the government neglected to fix. So the next time you lament the miserable road conditions or the high price of gas, remember who is gouging you first and foremost, it isn't the oil companies, it's your good friends in Ottawa and the provincial capitals.