Cutting the gas tax will provide immediate relief to the people of Saskatchewan
Saskatchewan is a land of long commutes and even longer road trips.
Farmers drive into small towns from their farms to pick up parts, and people who live in those small towns commute to the city for work. Then, on the weekend, everyone packs up their vehicles to trek across the province to fish, visit family or catch a game at Taylor Field in Regina.
You’d be hard-pressed to find a place that drives more than Saskatchewan. It’s a necessity; you can’t take a train from Regina to Prince Albert for a meeting. You must get in your car and hit the highway.
And with all that driving comes a hefty fuel bill.
Recently, the Saskatchewan NDP renewed its call for the provincial government to cut its 15-cent per litre tax on gasoline and diesel. NDP leader Carla Beck said: “Premier (Scott) Moe has the power to act today and suspend the gas tax … People are breaking the bank just to fill the tank.”
Cutting the gas tax is a no-brainer. The government can act on it quickly and save Saskatchewanians money instantly.
Unlike sending cheques, as the government did in 2022, or any other complicated affordability measure, a gas tax cut has no bureaucracy behind it. The government can just stop collecting the tax and Saskatchewan drivers can start saving.
The provincial government currently charges 15 cents per litre on both gas and diesel. A two-car family, with a minivan and a lighter duty pickup, would be saving $11 and $15 respectively every time they fill up. If that family fills up those vehicles once every two weeks, they would be saving more than $600 a year. That’s a monthly payment on one of those vehicles or a couple of trips to the grocery store.
In response to the NDP, the government says the roughly half a billion the government rakes in from the fuel tax is used to pay for government services.
Is that really what the money is spent on? According to the Fraser Institute, the government also spends an average of $869 million a year on corporate welfare, and that’s the most per person of any province.
Instead of taking money out of the wallets of Saskatchewan taxpayers at the gas station to give to corporations, the government should axe all its corporate welfare. That would be enough money to fully cut the gas tax, with a couple hundred million dollars left over.
The government then goes on to say the federal carbon tax is the real cause of unaffordability, citing its recent move to help by stopping the collection of the carbon tax on home heating in the province.
But the federal carbon tax is also one of the reasons why the government should move on this now. Even though Saskatchewanians aren’t paying the carbon tax on their heating bills this month, the carbon tax on fuel isn’t going anywhere fast.
Currently the carbon tax costs 14 cents per litre of gasoline, but come April, that cost jumps to 17 cents per litre. By 2030, it will be 37 cents per litre and cost the average Saskatchewan household $1,723 per year, according to the Parliamentary Budget Officer. And that’s including the rebates.
Premier Moe knows how much the federal carbon tax hurts the province. He has been fighting it longer than anyone else in the country, first as provincial environment minister and now as premier.
The move to stop collecting carbon tax on natural gas for home heating put up a shield for Saskatchewan residents against the carbon tax. But the government should go further and cut the provincial fuel tax to put up a wall.
If the government wants to continue to fight the carbon tax, it needs to keep taking action; it can’t rest on past achievements. The government needs to cut the gas tax and get Saskatchewanians some relief at the pumps.
Gage Haubrich is the Prairie Director for the Canadian Taxpayers Federation.
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