Ontario’s small business and tourism sectors are optimistic that the province’s temporary six-month cut in gas taxes will boost travel growth this summer. On Friday, the county gas tax was reduced by 5.7 cents per liter and the diesel fuel tax was reduced by 5.3 cents per liter in an effort to ease the economy amid rising pump prices. The temporary reduction will be valid until the end of the year and is expected to cost the province $ 645 million. Prime Minister Doug Ford’s Progressive Conservative government introduced the measure in April to combat rising oil prices triggered by Russia’s invasion of Ukraine. Since then, inflation has continued to soar and food and gas prices remain high. Gas prices may rise as they fluctuate throughout the summer, but Mr Ford said the tax cuts would provide at least some relief to people struggling with the high cost of living. The government estimates that this measure will save a family with two cars about $ 815 over the next six months. The President and CEO of the Ontario Tourism Industry Association, Chris Bloore, said it was a positive step for a sector hit by the “double blow” of the COVID-19 pandemic and rising prices. As tourism generated by the Canada-US land border is still half the pre-epidemic level, Mr Bloore said he hoped the tax cuts would allow families to travel and extend their stay. The gas tax cut is not currently on the table as the Liberals face accessibility problems In a survey conducted by Leger in May, 66 percent of drivers said high fuel prices would push them to cancel or restrict road trips this summer. “I’m sure it will mean that these people who are thinking of changing their journey from two weeks to a week will go back to spending two weeks because the only thing people desperately needed in the last two and a half years is the ability to travel and go out. go out and have fun again, “said Mr. Bloore. The tax cuts are also welcome news for small businesses that have struggled throughout the pandemic. Ryan Mallough, Ontario’s vice president of legal affairs for the Canadian Independent Business Federation, said fuel costs remain a major concern and were a top priority for member businesses ahead of the June county elections. Mr Malowe said 54 per cent of member businesses had not returned to pre-pandemic revenue levels and another 62 per cent were still in debt. “The hope is that it will take some pressure off consumers’ pockets and perhaps allow them to spend a little more freely on business,” he said. But as the price of fuel affects consumers as well as the shipment of goods, Mr Mallough said additional relief from the federal government would be beneficial. Speaking about the tax cut on Thursday at a Brampton 7-Eleven gas station, the prime minister reiterated these sentiments and urged the federal government to provide its own financial relief by temporarily reducing its share of taxes. “We need to do more and this is the time for all governments to come together to remove the pressure from the Canadians when they need it most,” Ford said. “This is a real, tangible solution we can offer Canadians at a time when costs are higher than ever and supply chain problems and global conflicts are making things worse.” Last week, Canada’s Natural Resources Minister Jonathan Wilkinson said the government has no immediate plans to cut pump prices, but is focusing on stabilizing prices by increasing supply. During his 2018 election campaign, Mr. Ford pledged to cut gas prices by 10 cents. The county withdrew its 4.3-liter-per-cap and trade-ceiling system, but this was canceled by the federal coal tax which then came into force. For the first weekend in tax cuts, Canadians for Affordable Energy chairman Dan McTeague said gas prices were expected to fall 11 percent on Friday and at least six extra cents by Saturday. As of Thursday afternoon, the average price of gas in Ontario was $ 2 a liter, according to data from the Canadian Automobile Association. “I do not think for a moment the prices of oil and gas have peaked,” said Mr McTeague. Also Thursday, Mr. Ford confirmed that he would recall the legislature on August 8 for a five-week session to re-introduce and approve the 2022-2023 budget. A budget was tabled late last year, and Mr Ford said the only expected change was a five per cent increase in disability support payment rates in Ontario. Our Morning and Afternoon Newsletters are compiled by Globe editors, giving you a brief overview of the day’s most important headlines. Register today.
