Ottawa proposed fuel tax hike, Paszkowski says

EDMONTON (May 19) — Alberta’s transportation minister said federal transport officials put forth a proposal to raise fuel taxes during a meeting last week with provincial transport leaders.

The proposal, which was opposed by the provincial ministers, would have amounted “to 30 cents or 40 cents per litre, which is very, very significant,” Walter Paszkowski, Alberta’s Minister of Transportation and Utilities, told the Edmonton Sun. A tax of three or four cents per litre more would be incurred over 10 years.

Current diesel fuel tax rates for the trucking industry in Canada range from 7.2 to 16.5 cents per litre, depending on the jurisdiction.

Trucking industry advocates have argued that commercial diesel fuel taxation is too often viewed as a sort of “sin tax” on engine emissions or highway use, similar to those applied to cigarettes and alcohol — not as a tax on an industry that’s vital to Canada’s economic growth.

All revenues collected from fuel taxes go directly into a consolidated revenue fund and are not dedicated to any specific purpose, such as environmental protection or infrastructure investment.