Unlike N.S., Premier Ghiz offers relief but only if Ottawa bears entire burden
We have to agree with Premier Robert Ghiz that cutting the province’s share of the HST from gasoline would be very costly to government coffers. But to simply sit back and let the marketplace continue to pump up prices without much discernable justification could be catastrophic to this province.
Islanders were mopping their bows with relief early Thursday when the scheduled price adjustments at month’s end from IRAC revealed a mere two cents per litre increase. There were widespread reports the increase was going to be much bigger — as high as 10 cpl — to dovetail with other recent double-digit increases across the country.
Nova Scotia and New Brunswick were already hit with major jumps last week and Islanders were bracing for the worst yesterday. Many saw themselves pulling up to the pumps Thursday and looking at $1.50 per litre in the window. As it is, the $1.42 number is very sobering.
The premier said, we presume tongue-in-cheek, that he likes the idea of reducing the amount of tax charged on gasoline in P.E.I., but the costs would have to borne entirely by Ottawa. How generous of him. Both governments greedily lap up taxes on gas. The excise tax is now 10 cpl for the feds and 13.1 cpl for the province. Add on the 14 per cent HST and you can readily see that a significant portion of the per litre cost can be laid at the steps of government.
And we are still a month or more away from the traditional heavy summer driving months when oil companies seize on that to pump up prices even further. The excuses for higher prices are endless - refinery shutdowns for maintenance, upgrades, a cold winter, a warm summer, an early fall, a lingering spring, unrest in the Ukraine, a bomb explosion in northern Nigeria or gout affecting a Saudi prince. The list goes on and on. And now our premier has chimed in.
Each increase at the pumps means additional HST and excise tax revenue. While government wrings its hands about gas prices, its tax coffers eagerly welcome the extra income. That unquenched thirst makes it appear neither level is very anxious about cooling the soaring trends on the costs of gas. It’s a very shortsighted viewpoint.
Does Premier Ghiz really believe that Ottawa will heed his plea for help? He’s really trying to pass blame or burden off onto the federal government while saying his hands are tied because of the province’s precarious financial situation. Ottawa is not going to jeopardize its budget plans for next year by covering P.E.I.’s HST losses on gasoline sales. A gift here would see other provinces demanding equal treatment.
It’s getting to the point where motorists are finding it cripplingly expensive to put gas in the family rig. Impacts are surely coming when Islanders can’t buy luxury items, shop in Charlottetown or make trips. And if we can’t take trips, what do you think our neighbours are thinking when making tourism plans this summer? Offering cheaper gasoline here is a powerful incentive for visitors to come across the Northumberland Strait.
We already have the highest prices for electricity. How long before someone realizes it’s just too expensive to live here anymore? Unemployment changes won’t force us out but energy costs just might.
In Nova Scotia, Premier Stephen McNeil plans to ask Ottawa to remove his province’s portion of the harmonized sales tax currently charged on top of the gasoline tax, explaining he wants to give consumers a break at the pumps. Premier McNeil at least is offering some hope for relief even though the cost is estimated at $25 million. Are you listening, Premier Ghiz?