Reignition on tax on tax question

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Today, any motorist filling the tank will face what was expected to be a record price for gas in Nova Scotia. Give or take a dime or so per litre, it’s the same all over.

Not that the free market is government’s business, but people paying outrageous prices often demand why government doesn’t do something.

As surprising as a sudden lane switch, Premier Stephen McNeil mused Thursday about the burden of gas cost and said his government will explore the possibility of dropping the provincial portion of the HST. As most know, we pay a motive fuel tax, and HST – apportioned to the feds and province – is tacked on top.

In this pitch, McNeil addresses the one thing government can do about price: the tax. He makes a good point: it’s a shame people have to put up with tax on tax.

He said it would save drivers about four cents a litre.

That’s perhaps the new math – government-style. Perhaps there's some costly bureaucratic paperwork involved. The provincial portion of HST is 10 per cent. With pre-HST gas prices well over a dollar now, one might expect a break of more than four cents. Perhaps we’ll hear a better explanation if this pitch goes anywhere.

Of course, calls by the public for such relief have come before, whenever prices spike, but governments say they can’t afford it.

A break of even something like a nickel is better than, say, a poke in the eye with a sharp stick. But obviously it’s only a marginal difference in buck-and-a-half prices.

The bigger discussion should include the fact we have a province that can’t afford to give up a penny of revenue – although Finance Minister Diana Whalen says this couldn’t happen until Nova Scotia balances its budget.

But in the long haul, where and how would they make up for this sacrifice to help out motorists?

The best bet is for consumers – everywhere – to continue finding ways to lower demand, and that’s the best impact on price. Buy efficient, tuned vehicles, walk or cycle more and drive less often.

Finding alternatives will save you more than four cents a litre.

Geographic location: Nova Scotia

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