The Conservative "Tax Trick"


I heard one of the Conservative attack ads on the radio for the first time yesterday. The radio ads are part of a highly orchestrated campaign, including a "Dion Tax Trick" web site.

How much of a tax are we talking about here? I had to look elsewhere to learn that Federal Liberal leader St├ęphane Dion proposes a tax that would initially be $10 per ton, and grow to $40 per ton over four years. How much will this cost us? Actually, not much. The tax would bring in about $15 billion, which is about $500 per capita. This would be offset, however, by an equivalent cut in income and business taxes and a boost in tax breaks for poor, elderly, northern and rural Canadians who would be hit by the increased cost of necessities such as home heating fuel, electricity, food and travel.

Now, let's have a look at the cost to consumers of Conservative government. When they took office in February, 2006, the average cost of a litre of gasoline 93.9 cents. It is now $1.469. This is an increase of 56%. Canadians purchase about 40 billion litres of gasoline per year, so the additional 53 cents per litre will cost Canadian consumers $21 billion this year.

So, the real "trick" here is being performed by the Conservatives and the petrochemical industry, who are banking on the reality that the public has a very short memory. The fact is, the petrochemical industry hates Dion, and they hate the idea of getting any reduction whatsoever in their record profits.

Here's another trick that Prime Minister Harper could try: he could invite his petrochemical industry friends over for martinis, and ask them to please reduce their prices, in order to reduce the likelihood that Harper and his government will be turfed out when the next election comes around. He could also plead our case with George W. Bush, who has even better oil industry connections (including the Saudi royal family) than the Conservatives do.