Why An HST Cut At The Gas Pumps Is A Bad Idea

A Commentary by Doug Draper

So who wouldn’t want to see a cut in prices at the gas pumps?

Well, just about everyone, of course, except the boys and girls running and owning shares in ‘Big Oil’. . And Ontario’s NDP leader Andrea Horwath – in keeping with her promise “to make life more affordable for you” -’is pitching a few ideas to keep those gas prices down.

One is to impose a weekly cap, to be administered by the Ontario Energy Board, to stop “gouging at the pump” and the other is to phase out the dreaded Harmonized Sales Tax (HST) on gasoline which would reduce the price by a few cents per litre.

Sounds good, doesn’t it? I got to admit that on the surface, it sounds good to someone like me, who remembers paying around 29 cents for a gallon of gasoline when I first started driving.a car. Those were the days, weren’t they?
Who needed public transit or more walkable communities when a gallon of gas was cheaper than a quart of milk? Just keep sprawling homes and malls further and further out into, the countryside and there in lies the problem with trying to keep prices at the gas pump down.

The record shows that when gas prices are lower or go down, it encourages people to go on purchasing and driving SUVs and other gas guzzlers. It isn’t until gas prices spike, as they have in recent years, that people begin to think about more fuel-efficient cars, or about carpooling or using public transit.

Horwath’s idea of phasing out the HST on gasoline may put a few more pennies per leader back in the pockets of consumers or it may simply mean that the gas companies will make up the difference by jacking the price back up to where it would be if the tax was still there. That would mean more money in their pockets and less taxes that could be used to build more efficient transit systems across the province – systems convenient and affordable enough to want to make us leave those cars at home or perhaps get rid of that second or third vehicle in the driveway.

As for the “weekly cap” on gas prices, it is hard to imagine how that would be administered, especially by an Ontario Energy Board that has never had that impressive a record of putting the consumer first when it comes to keeping energy costs down.

All in all, the Horwath and her party has had a pretty good record when it comes to speaking out for more environmentally friendly ways of living and doing business in the province. Horwath’s pledge to phase out of the HST on gas at the pumps, as popular as it may be, deviates from that record.

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