• Updated Report Part of CTF's 3rd Annual Gas Tax Honesty Day
• Taxpayers Launch National Worst Highway Contest
• CTF Uses Child's Construction Toys to Make Road Rehabilitation Point

Study -- Refining Tax from Gas

Provincial Fact Sheets

OTTAWA: The Canadian Taxpayers Federation (CTF) today held a news conference on Parliament Hill to raise awareness about government tax gouging at gas pumps across the country.

The launch of the CTF's 3rd annual Gas Tax Honesty Day campaign included an updated report that details federal and provincial gas tax gouging at the pumps, the lack of federal investment in Canada's roadways, and a national petition campaign to culminate in the fall with presentation to the federal Minister of Transport.

"Gas taxes continue to keep pump prices artificially high," added Robinson who was flanked by fat piggy bank labeled Ottawa and idle Tonka-like children's construction toys to drive home the point that Ottawa continues to gouge tax dollars at the pumps and neglects the national priority of road construction and rehabilitation. "Only four percent - or a paltry $190 million - of Ottawa's $4.7 billion take in gas tax revenues last year was plowed back into pavement. This is highway robbery. When it comes to gas taxes, the message for the feds is clear: use 'em or lose 'em."

"Today we are also launching Canada's 'Worst Highway Contest' and once selected, we'll challenge the Prime Minister and Minister of Transport to drive this patch of pavement," said CTF federal director Walter Robinson. "Our guess is that they won't be doing too much reading or signing any correspondence on this drive if they have the courage to rise to our challenge."

The CTF study, entitled Refining Tax from Gas provides an historical overview of gas taxes collected by the federal and provincial governments and makes the following recommendations:

• Treat federal, provincial and municipal gasoline tax as a user fee;
• Dedicate gasoline tax revenues to highway construction and maintenance;
• Reduce federal and provincial gasoline tax rates to levels commensurate with road and highway funding;
• Transfer greater share of federal gasoline tax revenues to the provinces for the express purpose of highway development;
• Having fulfilled provincial highway funding requirements, transfer a share of federal gasoline tax revenues to large urban centres for municipal roadway renewal;
• At a minimum, eliminate the 1.5 cent gas tax introduced in 1995 as a deficit fighting measure;
• Eliminate the HST and GST charges on the tax component of the pump price;
• Encourage service stations to post pre-tax and post-tax prices on appropriate exterior signage.

The study is not only critical of the government's record on gas taxes and road development, but it also reserves criticism for the oil industry's virtual silence on the tax issue. "Big Oil's complacency in not explaining the pricing structure of its product has allowed the suspicion of a price fixing conspiracy to fester even though countless studies have proven otherwise," added Robinson.

"Resentment against high gas prices is understandable but often misplaced. Motorists can't control world events, international price per barrel fluctuations, or the machinations of OPEC. But they can focus their energy at the domestic political level and force governments to lower fuel taxes. This is what Gas Tax Honesty Day is all about," concluded Robinson.

The CTF gas tax report will be posted by 11:30am EDT on the CTF web site: www.taxpayer.com.