Fleet Ops: Fuel Efficiency
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CTA urges Finance Committee to approve incentives for green trucks
OTTAWA -- It isn't very often business groups lobby governments to help them promote more expensive and complicated equipment and technology for their industry. But that's exactly what the Canadian Trucking Alliance has been doing the last few years in an attempt to accelerate the penetration of 2007 model smog-free, low-GHG heavy trucks into the Canadian fleet. This week, CTA addressed the House of Commons Standing Committee on Finance that is holding hearings into the 2008 federal budget, which is expected to be tabled by the Minister of Finance in the first part of next year. The trucking group urged the feds to approve financial or tax incentives for the new, environmentally-friendly engines, as well as harmonizing the federal excise tax on diesel fuel with the federal goods and services tax (GST).

CTA says its enviroTruck concept is the model Ottawa should
use in approving incentives and rebates for clean trucks.
David Bradley, CEO of CTA, urged the all-party committee of MPs to recommend the alliance’s enviroTruck initiative -- a program that makes it easier for fleets to purchase modern heavy trucks spec'd with aerodynamic, auxiliary power and other fuel economizing equipment. CTA says the initiative could increase fuel efficiency in the industry by over 20 percent, save almost a billion and a half litres of diesel fuel per year and reduce GHG emissions by almost 4 million tonnes if just half of the new tractor-trailer units sold in the country included the full package CTA is proposing. The carrier association is compares its rebate proposal to the Energy Star program for home appliances or the rebates on the purchase of energy-efficient light duty vehicles. It also says that accelerating the capital cost allowances, the rate at which truckers can write off their tractors and trailers for depreciation purposes would also be of assistance noting that the CCA rates are significantly slower in Canada than in the United States. "This is not a pipe dream," said Bradley. "The equipment and the technology for the trucking industry to be smog-free and to significantly reduce its contribution to GHG are here now; what we need is for government to work with industry to provide the added incentive that will enable the industry to invest in the new equipment and to replace its aging fleet more quickly." Bradley added that it's "high time the federal government took advantage of its healthy fiscal situation by eliminating the regressive excise taxes on commercial diesel fuel, which were introduced in the mid-1980’s specifically to raise money to reduce the prevailing deficits governments were recording at the time, by enveloping the diesel tax into the GST." Recently, the federal government indicated its desire to have the provinces that still have sales/consumption taxes on business inputs, to harmonize those taxes with the GST. "To be consistent and fair, the federal government needs to look at its own archaic way taxing commercial fuel in the transportation industry," says Bradley. "The taxation of business inputs is a critical issue for Canadian trucking companies who, like their customers in the manufacturing sector, are grappling to stay competitive and improve their efficiency and productivity in the face of the high value of the Canadian dollar." General reductions in corporate income tax rates are always helpful, continued Bradley, "but in low margin industries like trucking, it is the high level of taxation on our investment in fuel and equipment which really need to be addressed."
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