Canadian Manufacturing

GTHA truckers decry proposed diesel tax to fund transit

Industry group says Ontario's roads and highways need just as much attention and investment as transit.



Toronto—On the eve of Ontario’s budget vote, The Ontario Trucking Association (OTA) is objecting to the proposal from Metrolinx for a special 5-cent-per-litre tax on diesel fuel to help pay for the regional transportation agency’s $20-billion transit plan for the Greater Toronto and Hamilton Area (GTHA).

Indeed, the industry group says Ontario’s roads and highways need just as much attention and investment as transit.

“The trucking industry believes in paying its fair share for the infrastructure it uses. However, Metrolinx is a transit plan; it does not address the equally compelling need to maintain and upgrade the region’s or the province’s network of roads, highways and bridges,” says OTA’s president and CEO, David Bradley.

Instead, OTA’s position is that tax revenues generated from commercial diesel fuel taxes and heavy truck registration fees should be allocated to a dedicated provincial trust fund specifically for roads, highways and bridges.

“That’s where the trucking industry’s fuel tax dollars should be going,” Bradley says. “Truckers should not be expected to pay for transit. Unlike motorists who have a choice in terms of whether to drive or take transit, truckers have no such choice.”

These same truckers already got dinged with a 70-per cent increase in commercial plate fees announced by the McGuinty government before the former premier;s resignation in 2012.

The OTA says a better choice is to look at heavy utility trucks—namely mobile cranes, vacuum trucks, concrete pumping trucks, water trucks—which are exempt from the normal registration and licensing requirements and therefore pay no vehicle registration fees, use tax-exempt diesel fuel and are not subject to most other vehicle or safety compliance standards.

OTA estimates the revenue leakage to the province from this omission to be around $50 million per year.

“These are trucks; they serve many commercial purposes and customers, they operate on provincial highways and they impose wear and tear on the public infrastructure like any other motor vehicle,” says Bradley, noting that from a tax point of view, this equipment enjoys the same tax status as bicycles.

The OTA believes the new tax would impact the competitiveness of GTHA trucking companies and could cause some to re-locate outside elsewhere. Carriers outside the region are exempt from contributing towards the infrastructure costs, but gain the benefit of operating into, out of and through the region every day.

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