A proposed four-cent per litre hike in jet fuel taxes by the Ontario government has industry personnel up in arms – saying it will only lead to increased fares.
In the latest provincial budget, the Ontario government is proposing a four cents per litre hike, phased in over four years, effective once amendments to legislation are approved later this year.
Airlines currently pay four cents a litre in federal fuel tax for domestic flights, and depending on the province, may pay additional taxes on fuel used for both international and domestic travel.
Marc-André O’Rourke, director of the National Airlines Council of Canada, called the move troubling, and “shortsighted… misguided.”
Vision Travel COO Brian Robertson called the proposed fuel tax hike a travesty for Ontario.
“This tax hike will not only affect the airlines, but the industry as a whole, the trickle-down effect could be devastating, and at a time when we’re finally seeing some recovery in the industry,” he said. “The travel industry is the single largest contributor to the Ontario GDP, it’s quite inconceivable really that a government seeking to stimulate the economy will hand down a sweeping punishment to its largest economic driver.”
He added, “You also have to question why the Ontario government would more than double the tax when Alberta and BC have dropped it altogether. The future of our industry is significantly threatened by this move and we should rally behind the airlines to fight this.”