Thursday, August 11, 2005

Taxes to curb gas consumption don't work

The original argument for imposing higher gasoline taxes was to curb consumption. But consumption has chugged along and so has governments’ tax take. Between 1985 and 2003, gasoline sales steadily increased at an average rate of just over one per cent per year. According to Statistics Canada, retail gasoline sales in 1985 were just over 32 billion litres and just over 40 billion litres in 2004.

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8 comments:

Todd said...

This isn't on topic for this subject, but I'd just like to know who are the corporate donors to the Canadian Taxpayer's Federation. Since you aren't a registered charity I'm aware you don't have to provide this information. But in the ideal of transparency and accountability, I'm sure you'd be willing to offer this information up publically?

David MacLean said...

Of course not. We don't give tax receipts and our supporters have the right to support whatever groups they want in privacy.

I'll give you a hint though. If you look around you might see some businesses with a sticker in the window.

Todd said...

Exactly what I thought you'd say. Interesting that a 'Taxpayer Federation' probably is primarily funded by a corporate base. I'm not so interested in the mom 'n pop businesses that contribute to the Taxpayer's Federation as I am in which multinational conglomerates that do.

When you want to reveal your membership list and offer true transparency to the electorate then come back. Maybe you'll have a bit more credibility but until then, I'll just imagine you a mouthpiece for the Conservatives and other tax-avoiding corporations.

David MacLean said...

If you can't argue the idea, attack the source. Thanks for contributing. Come back soon!

Shawn said...

Congratulations David. This is the first troll I have noticed on your site. Get used to the stink, it means you are doing good work.

Rob said...

don't worry about it, todd. nobody in their right mind thinks of the CTF as anything other than a shill group. the merits of their arguments can be debated separately, but their motives are clearly derived from the interests of their donors and the only reason they remain secret is to maintain the cloak of populist legitimacy.

as for gasoline taxes not affecting consumption, well... it is clear from US numbers that the overall price of fuel does affect consumption. have you tried to sell a full-size truck in the US lately? good luck. for the first time in memory, the f-150 is not the top-selling vehicle in the country.

groups like the CTF tend to retreat to economic theory when it suits them, but in this case they seem to have abandoned it. the idea is that when a commodity becomes prohibitively expensive, the market innovates in ways that bypass or reduce consumption of the commodity. the CTF says that hasn't happened, and they appear to be calling for the government to subvert the market by demanding a reduction in prices. the CTF simply doesn't trust the market!

of course, according to the same theory, lower taxes should increase consumption, and we all know what that means: higher volume for the CTF's oil company donors.

essentially, what the CTF wants in this case is to stop the market from evolving in ways that will prepare us for future fuel shortages when, even if taxes drop to zero, our current dependence on large amounts of cheap fuel will leave us marooned.

it's also worth noting that, while the current transportation infrastructure is an essential part of our economy, driving is also one of our most destructive habits (in terms of personal health, social isolation, misuse of precious land, etc.). whether or not the government specifically earmarks gas tax revenues to mitigate the damages caused by the use of fossil fuels, they do (or will) spend a huge amount of money on it one way or other, and the gas tax - directly or indirectly - offsets the cost.

Scott Hennig said...

I enjoy comments on posts that are 3 years old!

So "Rob" I note that the NDP in BC oppose higher gas taxes there because it hurts working families. Any plans to stop by their blog and suggest they are only saying that because "Big Oil" is secretly funding them too?

Rob said...

my bad, i found the article through google and missed the date.

the problem with the gas tax isn't the tax itself, it's the fact that at the same time it was introduced, a subsidy for oil/gas exploration appeared too. it's not so much a pollution tax as a wealth transfer. what's the CTF's position on that? negative, i assume?

frankly, i think the NDP is grandstanding and i have no idea whether or not they're disguising a legitimate critique of the tax in some kind of populist veneer.

don't let any of that discourage you from actually addressing my original comment, though.

by the way, no need for "scare quotes" around my name. you know my real name, and i am not who you think i am.

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