Mr. Speaker, today is an official opposition supply day and I am delighted to speak to the motion.
The federal fuel tax issue is a prime example of a major irritant that has been allowed to continue since the government came to power in 1993 despite many attempts by the Canadian Alliance, the Federation of Canadian Municipalities, the Canadian Taxpayers Federation, and federal and provincial road builders to get the government to stop the process of taking billions of fuel tax dollars from Canadian motorists and not returning it to transportation infrastructure.
The statistics for my own province of British Columbia are illustrative. From 1998 to 2001, federal fuel taxes and the federal GST collected $6.4 billion from B.C. drivers and returned $31 million, roughly 0.5%.
Just as an indicator of the taxing power fuel taxes represent to the federal government, we witnessed earlier this year essentially a 10% increase at the pumps. This 10% increase represented a windfall to the federal government in GST fuel revenues alone of $350 million. The GST on fuel is for the most part a tax on a tax. That is most inappropriate.
On May 2, 2001, I embarrassed the federal transport minister by pointing out that in the previous year the United States had committed to spending more in British Columbia by upgrading B.C. highways at border crossings than did the federal government in all of British Columbia.
In the previous year, the federal government returned 0.5% of fuel tax revenues to British Columbia highways. The transport minister excused all of this by responding that it was not his fault because highways were a provincial responsibility. That being the case, then it is only logical to call on the federal authorities to vacate the federal fuel tax room to lower levels of government for their infrastructure requirements.
This is essential to our well-being and will address the fiscal imbalance that exists between the levels of government in Canada. Instead of fixing the fiscal imbalances, the former federal finance minister and now Liberal leader cut transfer payments to the provinces and made the situation worse.
The Canadian Alliance recognizes that changes have occurred over time and our institutional arrangements have not kept pace, unlike the government. Every attempt to get the federal government to stop the current reign of terror on federal taxation of fuel has been hindered by the federal Liberals.
Our industry and transportation critics have created a policy for the Canadian Alliance which was adopted by our parliamentary caucus and ratified by our national council. It is a policy we will run on in the next election, and it is a policy we will implement as government.
I can summarize our position quite well by including an excerpt from an address by the Canadian Alliance leader to the Federation of Canadian Municipalities' annual meeting in Winnipeg on June 2, 2003. Our leader proposed:
--that the federal government permanently vacate a portion of the federal gas tax--say three to five cents a litre--and allow provinces the option of collecting that revenue. In order to ensure that this money is not used for other purposes, the transfer of these revenues to provinces and on to municipalities would be conditional on signed agreements that these resources would be used for infrastructure.
This method of funding municipalities meets the criteria set out by the [Federation of Canadian Municipalities]: It would provide a reliable and stable revenue source for infrastructure. It would be as transparent and visible as constitutionally possible. It would have zero additional administrative and compliance costs--provinces already have infrastructure programs and collect gas tax revenues. It would be efficient--additional resources could be allocated to regional and local priorities. And it would be equitable--these revenues would become part of the equalization formula to ensure that all provinces receive the same per capita share of gas tax revenues. More importantly, this approach promises a worthwhile level of funding.
In the last federal budget, 100 million dollars were pledged for infrastructure for cities--not enough, as the [Federation of Canadian Municipalities] pointed out, for a single kilometre of subway line in Toronto or three interchanges in Calgary.
In contrast, transferring three cents per litre of gas taxes for infrastructure would mean an immediate, annual injection of $1.3 billion per year.
If we do the math, clearly the Canadian Alliance has a position that is on side with municipalities, provinces and the motoring public. The federal fuel tax regime is irrational and counterproductive. At every turn, however, the government has stymied our efforts to change this federal fuel taxing behaviour.
This is what the current finance minister had to say earlier this year when he rejected any notion of amending fuel taxes:
...I know that the provinces really like the tax points, but sometimes, they forget about them. They really like them because they want us to impose the taxes and then let them spend the money.
What money? During June of this year he stated further:
...I do not favour the suggestion that the federal government vacate the fuel tax...it is foregone revenue without accountability...it undermines the vital partnership that we must foster between and among levels of government.
That is not very encouraging.
On May 2, 2001, I asked the transportation minister the following question:
Last year the federal government collected $750 million from British Columbia fuel taxes and spent $408,000 on B.C. highways. That works out to the grand total of one-twentieth of one per cent of revenues returned to British Columbia highways. Why is the federal government gouging taxpayers and ignoring their highways?
Here is what the minister had to say:
I want to remind the hon. member that highway building in this country is the responsibility of the provincial government.
This incredible response was followed up by the finance minister's response to my further question, which was:
...the federal government collects federal fuel taxes. The provinces spend on highways what they collect in provincial fuel taxes. In 1998-99 the federal government collected over $4.7 billion in gas taxes and spent only 4% of that across Canada. It is called highway robbery. When is the government going to commit to fund a national highway strategy...?
The former finance minister, who may or may not have had a recent conversion on this issue, had this to say:
Mr. Speaker, the hon. member ought to know that the Canadian government receives tax revenues from a multitude of sources and those revenues are then invested. They have been invested...in the British Columbia health care system...in the education system...research and development throughout British Columbia.
That is not very encouraging for infrastructure.
The reality is that change is long overdue. We have a national highway system in Canada but no national highway strategy. We have long unresolved grievances about a lack of federal commitment to infrastructure. We have major transportation needs identified, many resulting from federal facilities, such as Roberts Bank and Vancouver International Airport.
As well, we have had serious problems at the provincial level in terms of funding because of the softwood lumber dispute, SARS, BSE, forest fires and hurricanes, heavy burdens indeed.
I will conclude with one sentence. The motion put forth by the Alliance today is consistent with an earlier motion we put forward on June 12, 2003, which was defeated by the government, and I hope for better this time.