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Businesses feel sting of carbon tax |
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Written by MYRISSA KRENZLER
Citizen staff
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Wednesday, 02 July 2008 |
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SHERRY SETHENPRINCE GEORGE CHAMBERLIBERAL
Local rancher Mark Grafton said fuel costs are affecting both his crops and cattle stock.
"It definitely effects us and we don't really have anything we can do to minimize that," he said. "We're trying to use machinery as little as we can, changing our farming methods when we can and things like that. But cost of fuel is still one of our big bills."
The Prince George Chamber of Commerce said it's worried businesses weren't given the proper information about the tax and owners don't realize where additional costs may pop up. To resolve this, the chamber has put a resolution forward to the B.C. Chamber of Commerce listing its concerns.
"The Prince George Chamber of Commerce feels that possibly we rushed into this a little too quickly and what we had called for when we heard of this was a sober second thought," said Sherry Sethen, executive director.
Because of the urgency to get the tax in place, Sethen said the chamber feels businesses will have to pass added costs on to the consumer. "For people on fixed incomes right now, (cost) is going to be significant," she said. "And it's not just the 2.5 cents they're going to pay at the (pumps). It's the additional cost that they're going to pay for all consumer products."
The timing of the tax is another concern. With the failing forestry sector and increase of transportation and mining in the province, Sethen said the chamber is worried the tax will drive away potential business. "While we believe that it's very important we do something for the environment, we have to balance between the economy and the environment," she said.
Grafton also said the timing of the tax is an unfortunate hit. Since the BSE (mad cow) crisis in 2003, ranchers have been in a difficult financial situation, making it hard to switch to new farming technology.
"Farming is changing extremely rapidly and one of the problems that we have is being able to invest in new types of machinery to be able to change our farming methods," he said. "The problem comes when you don't have the cash to make the capital investments."
The Liberal government's carbon tax, which went into effect July 1, will be phased in over five years to give consumers and businesses time to adjust.
The tax starts at a rate based on $10 per tonne of carbon emissions and rises $5 a year to $30 per tonne by 2012. The tax currently works out to an extra 2.4 cents a litre on gasoline, rising to 7.24 cents per litre by 2012.
The carbon tax on diesel and home heating oil will start at 2.7 cents per litre and increase to 8.2 cents per litre over the five-year period.
The tax is being billed as revenue neutral, meaning the government will not use money generated from the tax. The revenue, estimated to hit $1.8 billion over three years, will be returned to taxpayers through personal income tax and business tax cuts.
Sethen said the chamber wants to work with the government to come up with a solution on how to better administer the tax so tax neutrality can be achieved for everyone involved. "They have only committed and have only told us how we're going to do this for a year. So we are hoping, as a business community, that during that year the government will consult with business as we get more data fed back from our businesses on the implications on how that tax neutrality can be attained."
Sethen said the B.C. chamber should have a list of recommendations it will take to the provincial government to remedy business concerns after it's next board meeting within the next month.
-- With files from the Canadian Press
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Last Updated ( Sunday, 07 September 2008 )
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