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The goods and services tax is a value added tax introduced in Canada on January 1, 1991, by the government of Prime Minister Brian Mulroney. The GST, which is administered by Canada Revenue Agency (CRA), replaced a previous hidden 13.5% manufacturers' sales tax (MST).
In Canada, there are two types of sales taxes levied. These are :
A fuel tax is an excise tax imposed on the sale of fuel. In most countries the fuel tax is imposed on fuels which are intended for transportation. Fuel tax receipts are often dedicated or hypothecated to transportation projects, in which case the fuel tax can be considered a user fee. In other countries, the fuel tax is a source of general revenue. Sometimes, a fuel tax is used as an ecotax, to promote ecological sustainability. Fuel taxes are often considered by government agencies such as the Internal Revenue Service as regressive taxes.
The National Energy Program was an energy policy of the Canadian federal government from 1980 to 1985. The economically nationalist policy sought to secure Canadian energy independence, though was strongly opposed by the private sector and the oil-producing Western Canadian provinces, most notably Alberta.
The harmonized sales tax (HST) is a consumption tax in Canada. It is used in provinces where both the federal goods and services tax (GST) and the regional provincial sales tax (PST) have been combined into a single value-added tax.
The Canada Revenue Agency is the revenue service of the Canadian federal government, and most provincial and territorial governments. The CRA collects taxes, administers tax law and policy, and delivers benefit programs and tax credits. Legislation administered by the CRA includes the Income Tax Act, parts of the Excise Tax Act, and parts of laws relating to the Canada Pension Plan, employment insurance (EI), tariffs and duties. The agency also oversees the registration of charities in Canada, and enforces much of the country's tax laws.
Excise tax in the United States is an indirect tax on listed items. Excise taxes can be and are made by federal, state, and local governments and are not uniform throughout the United States. Certain goods, such as gasoline, diesel fuel, alcohol, and tobacco products, are taxed by multiple governments simultaneously. Some excise taxes are collected from the producer or retailer and not paid directly by the consumer, and as such, often remain "hidden" in the price of a product or service rather than being listed separately.
In Canada, taxation is a prerogative shared between the federal government and the various provincial and territorial legislatures.
Hydrocarbon Oil Duty is a fuel tax levied on some fuels used by most road motor vehicles in the United Kingdom; with exceptions for local bus services, some farm and construction vehicles and aviation, which pay reduced or no fuel duty.
An excise, or excise tax, is any duty on manufactured goods that is normally levied at the moment of manufacture for internal consumption rather than at sale. It is therefore a fee that must be paid in order to consume certain products. Excises are often associated with customs duties, which are levied on pre-existing goods when they cross a designated border in a specific direction; customs are levied on goods that become taxable items at the border, while excise is levied on goods that came into existence inland.
The Highway Trust Fund is a transportation fund in the United States which receives money from a federal fuel tax of 18.4 cents per gallon on gasoline and 24.4 cents per gallon of diesel fuel and related excise taxes. It currently has two accounts, the Highway Account funding road construction and other surface transportation projects, and a smaller Mass Transit Account supporting mass transit. Separate from the Highway Trust Fund is the Leaking Underground Storage Tank Trust Fund, which receives an additional 0.1 cents per gallon on gasoline and diesel, making the total amount of tax collected 18.5 cents per gallon on gasoline and 24.5 cents per gallon on diesel fuel. The Highway Trust Fund was established in 1956 to finance the United States Interstate Highway System and certain other roads. The Mass Transit Account was created in 1982. The federal tax on motor fuels yielded $28.2 billion in 2006.
The United States federal excise tax on gasoline is 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel. Proceeds from the tax partly support the Highway Trust Fund. The federal tax was last raised on October 1, 1993, and is not indexed to inflation, which increased 111% from Oct. 1993 until Dec. 2023. On average, as of April 2019, state and local taxes and fees add 34.24 cents to gasoline and 35.89 cents to diesel, for a total US volume-weighted average fuel tax of 52.64 cents per gallon for gas and 60.29 cents per gallon for diesel.
The main fuel tax in Australia is an excise tax, to which Goods and Services Tax ("GST") is added. Both taxes are levied by the federal government. In Australia the GST is applied on top of the fuel excise tax. In some cases, businesses may be entitled to exemptions or rebates for fuel excise tax, including tax credits and certain excise-free fuel sources.
Sales taxes in British Columbia come in the form of the Goods and Services Tax (GST) and Provincial Sales Tax (PST).
In Canada, the federal government makes equalization payments to provincial governments of lesser fiscal capacity so that "reasonably comparable" levels of public services can be provided at similar levels of taxation. Equalization payments are entrenched in the Constitution Act of 1982, subsection 36(2).
The British Columbia carbon tax has been in place since 2008. It is a British Columbia policy that adds additional carbon taxes to fossil fuels burned for transportation, home heating, and electricity and reduces personal income taxes and corporate taxes by a roughly equal amount. The carbon tax is collected at the point of retail consumption.
Fossil fuel subsidies are energy subsidies on fossil fuels, and in 2023 totalled over 1 trillion dollars. They may be tax breaks on consumption, such as a lower sales tax on natural gas for residential heating; or subsidies on production, such as tax breaks on exploration for oil. Or they may be free or cheap negative externalities; such as air pollution or climate change due to burning gasoline, diesel and jet fuel. Some fossil fuel subsidies are via electricity generation, such as subsidies for coal-fired power stations.
A value-added tax is a consumption tax that is levied on the value added at each stage of a product's production and distribution. VAT is similar to, and is often compared with, a sales tax. VAT is an indirect tax, because the consumer who ultimately bears the burden of the tax is not the entity that pays it. Specific goods and services are typically exempted in various jurisdictions.
Green economy policies in Canada are policies that contribute to transitioning the Canadian economy to a more environmentally sustainable one. The green economy can be defined as an economy, "that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities." Aspects of a green economy would include stable growth in income and employment that is driven by private and public investment into policies and actions that reduce carbon emissions, pollution and prevent the loss of biodiversity.
Carbon pricing in Canada is implemented either as a regulatory fee or tax levied on the carbon content of fuels at the Canadian provincial, territorial or federal level. Provinces and territories of Canada are allowed to create their own system of carbon pricing as long as they comply with the minimum requirements set by the federal government; individual provinces and territories thus may have a higher tax than the federally mandated one but not a lower one. Currently, all provinces and territories are subject to a carbon pricing mechanism, either by an in-province program or by one of two federal programs. As of April 2024, the federal minimum tax was set at CA$80 per tonne of CO2 equivalent, set to increase to CA$170 in 2030.
References
- ↑ "Oil and Gas Prices, Taxes and Consumers". Department of Finance (Canada). July 2006. pp. 6b) Application of the GST. Archived from the original on 2007-11-20. Retrieved 2007-12-13.
- 1 2 Agency, Canada Revenue (2017-06-22). "Current Rates of Excise Taxes". www.canada.ca. Retrieved 2022-03-09.
- 1 2 Agency, Canada Revenue (2022-09-08). "Fuel Charge Rates". www.canada.ca. Retrieved 2023-12-22.
- 1 2 "Gasoline Tax". Finance. 22 July 2019. Retrieved 2022-03-09.
- 1 2 Toolkit, Web Experience (2017-03-14). "Gasoline Tax Rates". www.princeedwardisland.ca. Retrieved 2022-03-09.
- 1 2 "Nova Scotia Department of Finance - Tobacco & Fuel". www.novascotia.ca. Retrieved 2022-03-09.
- 1 2 Government of New Brunswick, Canada (2013-01-30). "Gasoline, Motive Fuel and Carbon Emitting Product Tax A basic overview of the taxation of gasoline, motive fuel and carbon emitting products". www2.gnb.ca. Retrieved 2022-03-09.
- 1 2 3 "Fuel Tax Rates". Revenu Québec. Retrieved 2022-03-09.
- ↑ "Table of Fuel Tax Rates in Québec, by Region" (PDF). Revenue Quebec. June 2017. Retrieved March 9, 2022.
- 1 2 "Gasoline Tax". www.fin.gov.on.ca. Retrieved 2023-01-01.
- ↑ "Mixed feelings as Manitoba's gas tax holiday begins - Winnipeg | Globalnews.ca". CJOB. Retrieved 2024-01-04.
- 1 2 "Information Bulletin FT-1 The Fuel Tax and Road Use Charge Act" (PDF). SETS Saskatchewan eTax Services. October 1, 2021. Retrieved March 9, 2022.
- 1 2 "Fuel tax rates". Alberta. Government of Alberta. Retrieved 3 April 2024.
- 1 2 3 4 5 6 7 8 9 10 11 12 "Bulletin MFT-CT 005 Tax Rates on Fuels" (PDF). gov.bc.ca The official website of the Government of British Columbia. April 1, 2023. Retrieved December 21, 2023.
- 1 2 "Find current fuel tax rates in Yukon". yukon.ca. 2019-06-11. Retrieved 2022-03-10.
- 1 2 "Fuel tax rates english" (PDF). Government of Northwest Territories - Finance. Retrieved March 9, 2022.
- 1 2 "Nunavet Tax Rates 2022" (PDF). Government of Nunavet. January 1, 2022. Retrieved March 9, 2022.
- ↑ "Taxation Division - Finance". Province of Manitoba - Finance. Retrieved 2022-03-09.
- ↑ French, Janet (March 7, 2022). "Alberta to pause collection of provincial fuel tax to help consumers shocked by high prices". CBC news. Retrieved March 24, 2022.
- ↑ "Pumped up: Alberta gas tax slated to return in January". Calgary. CBC News. 23 November 2023. Retrieved 21 December 2023.
- ↑ "ARCHIVED - BACKGROUNDER – OIL AND GAS PRICES, TAXES AND CONSUMERS". Department of Finance Canada. October 2005. Retrieved 7 February 2013.
- ↑ Ministry of Transportation. "Backgrounder - How municipalities benefit from provincial gas tax funding". Canada NewsWire. Government of Ontario, Canada. Archived from the original on 2014-03-14. Retrieved 2007-09-07.
- ↑ QMI, Agence (17 March 2022). "Les Québécois préfèrent l'idée d'un pétrole "Made in Quebec"". Le Journal de Montréal. Retrieved 2022-03-24.