The Sad Truth About Pain At The Gas Pumps

Our gas pains are from taxes

By ALLAN PARKER

This is your lucky day--I'm going to tell you a simple secret to save 20% the next time you fill up at the pump.

Here it is: Drive an hour and a half down the QEW and buy your gas in the United States.

Now, I don't recommend doing that on a weekly basis, but a driving vacation in the U.S. this summer is substantially cheaper -- 20%, in fact -- than on this side of the border.

I just got back from a three-week road trip through the eastern U.S. I paid between $3.89 and $4.24 a gallon for gas, with the usual rate about $4.

That may seem like a lot, but only because we get confused by the conversion between litres and gallons. With the dollars at par we don't have that added conversion nightmare.

A U.S. gallon is 3.785 litres, so if you're paying $1.33 per litre, your Canadian gas is costing you a little over $5 per gallon.

Why? As I understand it, Canada is a petroleum-exporting nation and the U.S. is a net petroleum importer. Shouldn't that mean our gas is cheaper than American gas?

And the oil companies get roughly the same amount of your money on both sides of the border.

The difference is what you pay in taxes. In New York state (one of the higher-taxing states), the total tax grab on a gallon of gas is 59.6 cents, including the 18.4 cents-per-gallon federal excise tax.

By comparison, if you convert the taxes on a litre of gas in Ontario to gallonage, you're paying about $1.20 per gallon in taxes -- Ontario's 14.7 cents-per-litre gas tax, the federal excise tax of 10 cents per litre and 5% GST, which currently works out to about 6.5 cents per litre.

Our governments inhale the income from high gas taxes like crack cocaine -- or gas fumes. They're addicted and can't give it up.

Toronto Sun Money Editor Linda Leatherdale has been leading a campaign to cut the provincial and federal gas taxes in half and axe the GST altogether.

That would bring us in line with U.S. pump prices.

The response so far? Nada.

Every time you meet glad-handing politicians at a barbecue or fair this summer, ask them why they're gouging you 20% at the pump. Ask again and again.

If they try to tell you the high gas taxes pay for Canada's higher standard of living, tell them to get their facts straight.

Much of our gas tax is supposed to go to infrastructure and roads, but American roads are generally better than ours.

Health care? About 20% of federal and provincial Canadian government expenditures go to health. The U.S.? About 20% of their federal government's budget goes to Medicare and Medicaid.

Military? Another 20% of the U.S. federal budget is for national defense. Canada? Less than 5%.

Based on all that, it seems to me we should be paying lower taxes at the pump than Americans.

But we're not. We're paying $1 a gallon more than Americans for gas and a very specific group of people -- our provincial and federal politicians -- are taking that money out of our pockets.

If they aren't ashamed of themselves, they should at least be held accountable. The buck stops there