MCNEIL: PROPOSING TO MAKE GAS TAXES FAIR FOR ALL NOVA SCOTIANS
Date: Wednesday January 27, 2010

(Halifax, NS) Liberal Leader Stephen McNeil is proposing a constructive solution to deal with residents at the border buying their gasoline in New Brunswick.

Today the province’s Utility and Review Board is meeting to decide whether taxes on gas in the community of Amherst should be removed to deter residents from driving to New Brunswick to purchase gas.

McNeil proposes removing the “tax on tax”. Currently, HST is calculated after the province adds its motive fuel tax of 15.5 cents per litre. This “piggybacking” of the taxes amounts to more than 3 cents per litre.

“Gas regulation policy is fundamentally unfair to Nova Scotians and has resulted in higher prices at the pumps,” said McNeil. “A better solution that will benefit all Nova Scotians who have to deal with high gas prices every day is to give them a break at the pumps by changing the way we calculate our tax formula on gas.”

The current gas tax formula calculates the HST after the motive fuel tax is added to the base price of gas. McNeil’s solution would see the HST calculated before the motive fuel tax is added to the base price of gas, which better reflects the price at which gas is traded, saving consumers more than three cents per litre each time they fill up.

“All Nova Scotians deserve to pay less at the pumps, regardless of what corner of the province they live. If we can give consumers and retailers a break of three cents per litre by simply removing the unfair double taxation of gas, all Nova Scotians would benefit,” said McNeil. “People would be less likely to drive across the border to get their gas, and the province would become more competitive.”

While in opposition, the NDP were opposed to a “tax on tax” of gas and McNeil says Finance Minister Graham Steele now has the power to follow through on that policy.

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