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CTA asks feds to suspend carbon tax on diesel fuel
The Canadian Trucking Alliance (CTA) is appealing to the feds to suspend the carbon tax on diesel fuel as part of its pre-budget submission for 2025.
“The trucking industry needs to be a part of the solution to a zero-carbon based transportation sector,” said CTA president Stephen Laskowski.
“The industry is currently spending billions of dollars on technologies to reduce its carbon footprint and we continue this financial commitment towards capital purchases and operational practices designed to reduce carbon. In turn, the Government of Canada policy and regulations must come to the hard realization of the technological limitations for the trucking industry in obtaining this solution and an understanding that the journey towards zero emission engines for the heavy truck industry is a long one.”
Among its recommendations, the CTA is asking the federal government to:
- Reinstate the federal excise tax (FET) refund for trucking idle-reduction technology (TIRT), which is used by the industry to reduce fuel consumption;
- Reverse the removal of excise tax refunds for fuel consumed by power take-off units (PTOs);
- Implement a tax exemption for fuel saving technology;
- Better support the risk-free testing of green and other emerging technologies in real-world conditions;
- Suspend the carbon tax for a minimum of four years on diesel fuel, citing: “Currently, no wholly viable alternative exists, and the current tax serves no policy purpose in the sector”;
- Work with the province of Quebec and the Quebec Trucking Association to find a reasonable solution to the issue of double taxation between the federal and provincial carbon pricing systems.
Of these measures, the single largest policy issue under the environment negatively impacting the trucking industry is the carbon tax, the alliance said.
“Despite supplier and carrier efforts and investments, the trucking industry has no viable zero emission engine technology to deploy currently,” explains Laskowski. “The carbon tax on diesel fuel is currently having zero impact on the environment and is only serving to needlessly drive up costs for every good purchased by Canadian families and businesses. The carbon tax needs to be repealed from diesel fuel until viable propulsion alternatives are available for the industry and the Canadian supply chain to choose from.”
The CTA estimates the carbon tax adds between $15,000 and $20,000 a year in additional costs for longhaul truckers, or about 6% of the cost of operating that truck. A five-truck fleet would shell out between $75,000 and $100,000 a year in carbon tax.
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