Fleet Ops: Fuel Efficiency
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BC carbon tax could sink truckers: BCTA
VICTORIA -- A myriad of proposals to make B.C. greener has some truckers worried that they'll be seeing red on their bottom lines. Finance Minister Carole Taylor announced in the 2008 budget a series of initiatives to reduce greenhouse gas emissions by one-third by 2020, including a controversial proposal to apply a "revenue-neutral" carbon tax on virtually all fossil fuels, such as gasoline, diesel, natural gas, coal, propane, and home heating fuel. Under the program, diesel would immediately rise another 2.2 cents per litre above market prices, increasing to over 8 cents a litre by 2012. The plan, which if approved by the legislature would take effect July 1, 2008, would make B.C. the first jurisdiction in North America to institute a carbon tax.

With the carbon tax taking effect, truckers can expect to pay
over 2 cents a litre more now, and more than 8 cents in five years.
The revenue from the tax will supposedly be returned to businesses and individuals through a new Climate Action Credit for persons with lower incomes ($395 million) and reductions to personal income tax rates ($784 million), the small business income tax rate ($255 million), and the general corporate income tax rate ($415 million). In addition to the revenue-neutral tax reductions, every British Columbia resident will receive a one-time, $100 Climate Action Dividend to help people "adopt greener lifestyles." "The principle is simple," said Taylor. "Tax carbon-emitting fuels to discourage their use, and give the money back to people, back to businesses, so they have control. They can make their own choices about how the tax affects them. At the same time, by making greener choices more commercially viable, it will stimulate innovation and open up new economic opportunities across British Columbia." However, that isn't exactly the case for the trucking industry, notes BC Trucking Association President Paul Landry. He says that although the carbon tax is supposed to be "revenue neutral," truckers will still carry most of the burdon because, unlike passenger car commuters, they don't have the option of scaling back their driving hours. Landry tells the Times Colonist that the carbon tax will cost the industry tens of millions over the next five years. A single operator with one truck will have to fork over an additional $1,000 for fuel this year alone, about $3,000 in 2009 and $6,000 in 2012. "Carbon taxes may have a role to play in encouraging the reduction of greenhouse gases in some sectors and amongst consumers, but the trucking industry has no choice but to rely on diesel fuel to keep the economy moving," he says. "The trucking industry is largely responsible for the transportation of food, merchandise, parts and equipment each day -- breathing life into the province's economy and our individual well-being." Also, he adds, it will be extremely difficult to recoup the costs through rate increases because the general freight industry and forestry sectors, especially, are struggling in this economy. "Our members have clearly told us that a tax like this won't be easy to pass on," he says. "Some of them are bound by contracts. Other trucking companies are price takers because some of the industries we serve, such as forestry, are under extreme pressure." The carbon tax may also negatively affect B.C.’s competitiveness, Landry explians. Diesel fuel taxes in the province will now be up to three times higher than in Alberta and almost twice as much as most other provinces. Manufacturers, retailers and resource sectors will have to pay more for trucking transportation services. These climate action initiatives also include: a new biodiesel production incentive; new funding for home energy audits and retrofits; sales tax exemptions for ENERGY STAR appliances; up to $2,000 in reduced sales tax on the purchase of fuel efficient vehicles; an expanded venture capital program aimed at clean technology companies; and funding to reduce emissions at B.C.s ports and commercial truckstops. For the Finance Minister's speech and more about details on Balanced Budget 2008, visit www.gov.bc.ca/bcbudget online. -- with files from the Times Colonist
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