Move over credit crisis, spiralling global oil prices have become the West’s biggest economic worry
WASHINGTON–Somewhere between the implosion of Wall Street firm Bear Stearns in March and today’s $130-plus oil, inflation supplanted the credit crunch as North America’s biggest economic worry.
Just a few weeks ago, investors were paralyzed by fears that Bear Stearns could be the first of many financial firms to fall. But the relative calm – and rise in the case of Canada and Mexico – that has settled over markets since then encouraged buyers to tiptoe back into stocks.
Now, the mood is wary once again as oil has surged more than 30 per cent so far this year and economists warn that it is cutting into consumer spending and eroding corporate profits. U.S. stock markets, which had been taking cues from the latest bank rumour, now slide on each new high for crude.
“For the first time in our memory, inflation, not growth, is the primary macro driver at the global level,” Merrill Lynch economists wrote in a note to clients.
“The inflation shock has already happened. What matters now is how persistent it is, and how markets and policy-makers react. At a global level, this begs for an accident that will awaken markets and policy makers to the risks.”
Stumble It!
Also, why is it so impossible to get our politicians to ease off on gas tax? Instead, they all stand by and watch the whole ecomony go down the drain, leading us all into deep recession. Idiots.
Also, why is it so impossible to get our politicians to ease off on gas tax? Instead, they all stand by and watch the whole ecomony go down the drain, leading us all into deep recession. Idiots.
9 - 15 cents a litre is a drain in the economy? So gas would be in the $1.21 - $1.09 range?
Eliminating the gas tax would be useless as far as the economy goes. Making gas sold in Canada required to be refined in Canada would go much further.
See this…..
2. Federal and Provincial Gas Tax Rates and Application
Gasoline and diesel fuel are taxed by the federal, provincial and territorial governments.
At the federal level:
The excise tax on gasoline is 10 cents per litre while the excise tax on diesel fuel and aviation fuel is 4 cents per litre. Since these amounts are charged at flat rates per litre rather than on a percentage basis, the amount of excise revenue the Government receives does not vary with price changes at the pump.
The goods and services tax (GST) is 7 per cent of the final price paid for fuel, including federal and provincial excise taxes levied at the producer/wholesaler level, and is embedded in the retail price. The GST does not apply to provincial sales taxes levied at the pump as a percentage of the final price.
Companies and self-employed people can claim full refunds of GST paid on any business-related expense, including gasoline and other kinds of fuel. These refunds are called input tax credits.
At the provincial/territorial level:
Tax rates on gasoline range from 6.2 cents per litre in the Yukon to around 21 cents per litre in Prince Edward Island (see table in Section 4 for all provincial/territorial rates).
As a national average, the provincial tax rates on gasoline are about 14.5 cents per litre.
Tax rates on diesel range from 7.2 cents per litre in the Yukon to around 20 cents per litre in Prince Edward Island—again averaging about 14.5 cents per litre.
Special fuel surtaxes are levied in Victoria, Vancouver and Montréal.
In New Brunswick, Nova Scotia, and Newfoundland and Labrador, the provincial portion of the harmonized sales tax (HST) is levied on the final price of fuel at the pump (excluding GST).
In Quebec, the Quebec Sales Tax is levied on the final price of fuel at the pump (including GST).
Tax Components of Gasoline at $1 per Litre
Province Provincial Excise Tax (Flat Rate) Provincial Sales Tax1 Federal Excise Tax (Flat Rate) Total GST GST "Tax on Tax" (Included in Total GST) Total Tax Component
N.L. 16.5 7.5 10 6.5 1.86 40.5
P.E.I.2 21.3 N.A. 10 6.9 2.19 38.2
Nova Scotia 15.5 7.4 10 6.5 1.79 39.4
New Brunswick 14.5 7.3 10 6.4 1.72 38.2
Quebec 15.2 7.4 10 6.5 1.76 39.1
Montréal 16.7 7.5 10 6.6 1.87 40.8
Ontario 14.7 N.A. 10 6.4 1.73 31.1
Manitoba 11.5 N.A. 10 6.2 1.51 27.7
Saskatchewan 15 N.A. 10 6.4 1.75 31.4
Alberta 9 N.A. 10 6.0 1.33 25.0
B.C. 14.5 N.A. 10 6.4 1.72 30.9
Vancouver 20.5 N.A. 10 6.8 2.14 37.3
Victoria 17 N.A. 10 6.6 1.89 33.6
Yukon 6.2 N.A. 10 5.8 1.13 22.0
N.W.T. 10.7 N.A. 10 6.1 1.45 26.8
Nunavut 10.7 N.A. 10 6.1 1.45 26.8
Canada Avg. 14.5 2.2 10 6.5 1.72 33.2
http://www.fin.gc.ca/toce/2005/gas_tax-e.html
Making the gas sold in Canada require to be refined in Canada would create many full time jobs. I'd be all for eliminating the taxes on fuel, if only the government would show an equal decrease in size and spending to compensate. But nether is going to happen.