CTA disappointed federal budget does not include diesel tax break

by Canadian Shipper

OTTAWA, Ont. — The Canadian Trucking Alliance (CTA) says it is disappointed the federal budget announced yesterday does not include the 50% reduction in the federal excise tax on diesel that was promised before the recession shuffled government priorities.

The diesel tax cut was promised during the 2008 election campaign but disappeared when the recession devastated Canada’s economy. The CTA said it’s not surprised the tax cut was not delivered in the budget, but it had at least hoped the revenue would be earmarked towards green transportation projects in support of the CTA’s enviroTruck concept.

“It appears we are back to where we were in 1984 and 1985, where the excise tax on diesel fuel serves no policy purpose other than to pay down the deficit,” said David Bradley, CEO of the CTA. “Not that paying down the deficit should not be a priority, it is. But is it fair that it be done on the back of the commercial transportation industry, relying upon an archaic and regressive form of tax on our members’ primary business input at the same time as the industry needs to re-tool and is being challenged to reduce its GHG emissions?”

Finance Minister Jim Flaherty’s budget was touted as a “jobs and growth” budget. As far as taxes go, there were no major surprises.

Flaherty suggested the feds’ Economic Action Plan is working and he committed to providing further stimulus funding of nearly $20 billion this year.

Transportation-related projects highlighted in the budget included: $10 million over three years for a new Windsor-Detroit crossing; $50.5 million over two years for capital improvements to the Jacques Cartier and Champlain Bridges in Montreal; $175 million for Marine Atlantic; and $28 million for ferry services in Atlantic Canada. Canada Border Services Agency will also get $87 million over two years to improve its information systems and scanning equipment.

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