SASKATOON (Staff) — Even if the railways’ fuel taxes were cut back, farmers might not be any further ahead, says a member of the Senior Grain Transportation Committee.
The railways say federal and provincial fuel taxes work out to $1.20 on every tonne of grain, a cost that is paid by producers and government through the freight rate. Reducing or eliminating the tax, they say, would save farmers money.
But Harry-Jae Elder, a Fillmore, Sask. farmer and elected member of the transport committee, expects governments will collect the money one way or another.
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“As a taxpayer, I’m convinced that the province would have to get the money from some place and in a largely rural province like Saskatchewan that probably would be the farm sector,” he said.
It’s not unreasonable for the provinces to collect tax revenue from the railways, he said, and there aren’t many ways for a province like Saskatchewan to do it besides taxing fuel.
National Farmers Union president Art Macklin said farmers won’t shed too many tears on the railways’ behalf. If the rail companies opened their books to public scrutiny, he said, “then we might be in a position to make an objective judgment whether they’re being treated unfairly.”
CN Rail spokesman Scott Roberts said the railways are well aware they’ve never been viewed with much sympathy by grain farmers, but in this case the economic interests of the railways and farmers coincide.
Make opposition known
“What we’re saying to the people who are listening and reading these ads is ‘if you think the level of taxation is a problem, then raise it with those who establish tax policy and set the rates’,” he said.
Western Canadian Wheat Growers Association president Hubert Esquirol might do that. He’s sympathetic to the railways’s arguments and his organization might ask governments to reduce the fuel tax.
“Now that we’ve seen taxes lowered on cigarettes, which kill people, maybe there’s a reason to lower the tax on transportation, which generates economic wealth,” he said.
Alberta Wheat Pool has already asked the Alberta government to eliminate the province’s nine-cent-a-litre tax, which translates into about 27 cents per tonne of grain.
Mike Scally, the pool’s manager of policy and business research, said the fuel tax has no redeeming features. It’s regressive, it’s hidden, it takes money directly out of farmers’ pockets at a time when they can ill afford it and it penalizes exports.
