Tuesday, May 28, 2024

MTQ in search of a way to replace gasoline tax returns

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Cole Hanson
Cole Hanson
"Extreme twitteraholic. Passionate travel nerd. Hardcore zombie trailblazer. Web fanatic. Evil bacon geek."

Because of transportation electrification, windfall gains from the fuel tax, which allows the Quebec government to recoup an average of $2 billion annually, is set to dry up, so that the government should consider replacing it.

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“We have less and less gasoline consumption, but because there are taxes on gasoline, there will be less and less taxes going into government coffers,” explained Jill Beyer, a spokesperson for the Department of Transportation (MTQ).

To prevent a blow, MTQ launched, in 2019, its mobility finance job site, which has just expired. More than 240 partners were interviewed and 58 briefs were submitted.

The department is looking for a way to recover at least $2 billion annually, or the equivalent of fuel tax revenue.

The situation has been analyzed in several places in the world, for example the situation in the United States, Norway, Sweden and Germany.

“We chose 39 tools, which are sometimes used already, but can be used differently,” the MTQ spokesperson explained.

MTQ does not want to reveal which measures will be prioritized and analyzed so as not to alert taxpayers unnecessarily. But here are some examples raised in the official documents:

  • Electric car charging tax
  • fees
  • cordage outcome
  • Reserved lanes with duty-free access
  • High cost of driving licenses and registrations
  • Acquisition tax on luxury or electric cars

Concretely, these measures could have implications for motorists’ wallets.

What is the probability that license plates will increase by $1? This means that if there are 6 million cars registered in Quebec, that’s more than $6 million for the government. What will be analyzed is the management aspect. Is it simple, is it effective, is it fast? Mr. Bayer said.

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A report will be submitted in 2023, and elected officials will then have to act and implement some of the recommendations.

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