By Maureen Bader
Each year, the Canadian Taxpayers Federation holds a Gas Tax Honesty Day so motorists know that tax is the biggest single component of the pump price.
Taxes, for drivers in the Lower Mainland, account for about 37 percent of the price of a litre of gasoline. Motorists should also know the biggest chunk of this tax does not help fund healthcare and education, it funds the Lower Mainland’s transit behemoth, TransLink.
In the Lower Mainland, the cost of oil accounts for 32 percent of the price of a litre of gasoline, refining for 22 percent, and marketing for nine percent. The remainder is a myriad of gas taxes including a 10-cent-per-litre federal tax, a 6.75-cent British Columbia Transportation Authority tax, a 2.34-cent carbon tax, a 1.75-cent provincial tax, and, the biggest of them all, a 12-cent TransLink tax. To top it off, drivers pay GST on the entire pump price, including other taxes!
The TransLink tax grab has gone nowhere but up. It rose from eight cents per litre in 1999, when it was created, to 12 cents per litre in 2005, where it still sits. From this, TransLink raked in $262 million from gas taxes in 2008. Under new legislation, TransLink is able to raise its gas tax to 15 cents per litre, so if TransLink’s lobbying efforts are successful, expect to pay even more tax at the pump.
Drivers aren’t the only ones gouged by TransLink. In 2008, TransLink also collected $256 million in property taxes, $9 million in parking site taxes, $18 million in hydro taxes, and $15 million in parking sales taxes. The brain trust in Victoria should explain the link between heating and lighting a home and taking the bus—this is nothing more than a tax grab.
Drivers might be surprised to learn that TransLink’s mandate includes funding and operating a regional transportation system that includes the major road network in the Lower Mainland. Drivers should be surprised because they funded about 30 percent of TransLink’s costs in 2008 yet only benefit from about five percent of TransLink’s spending. In fact, TransLink spends more on administration than it does on road maintenance. This may be no surprise as the big pay increase the new board of directors gave themselves in 2008 in a closed meeting was widely reported. This increase helped boost the cost of the new board five times higher than that of the old board. Some TransLink salaries, such as former CEO Pat Jacobson’s, at $360,595 in 2007, were almost six times the median income level in B.C. of $62,600.
According to the B.C. Trucking Association’s analysis of TransLink’s 10-year plan, drivers’ burden will get even worse. TransLink plans to have road users pay more and get less. Road users would pay more than 60 percent of the planned tax hike, but get no additional benefit.
What makes this gouging even worse is TransLink’s own estimates show people will still prefer to use their cars in the future. Public transit ridership will increase by only 2.3 percent per year to 2012, and 1.5 percent annually after that, while TransLink’s costs will go up by 20 percent between 2009 and 2011.
There is no evidence showing TransLink’s share of trips in the Lower Mainland will increase beyond its historic share of approximately 11 percent. Drivers will continue to use their private vehicles to get from A to B and, as TransLink’s priority is public transit, ever higher taxes to TranLink will not help solve most people’s transportation problems.
Drivers are reaching their limit on their willingness to be gouged by governments. TransLink will continue to use drivers as a cash cow for politically motivated spending and to pay for its high administration costs while the economy of the Lower Mainland will be left stuck in traffic.
It’s time to take the responsibility for roads and gas tax revenues away from TransLink and downsize TransLink’s grandiose plans to match peoples’ ability—and willingness—to pay.
Maureen Bader is the B.C. director of the Canadian Taxpayers Federation.