Tax the crude out of the oil industry

Last week it was announced that major oil companies in Canada have been paying less corporate tax than businesses of similar size. But what’s worse is that they’ve been paying even less than small businesses!
Now I’m not one to advocate a controlled market, or a 50 per cent corporate tax rate. But the fact is when you have businesses that are taking in hundreds of millions of dollars in revenue every quarter and not being taxed proportionately, it becomes a problem.
Petro-Canada made over $1.5 billion in profits last year. And yet according to a financial analyst Brigitte Alepin, the corporate tax rate on these profits was 16 per cent, compared with 20 per cent for large corporations of similar size and 22 per cent for small businesses.
Does anyone else see the problem with this? If you or someone you know runs a small business, you know how hard it can be to make ends meet. After rent, utilities, employee salaries, other assorted operating costs and finally business tax, there’s really not much left over at the end of the day.
How the government can justify that a massive corporation like Petro-Canada, while taking in billions in profit, can actually pay proportionately less tax than the mom and pop shops is beyond me. A four per cent hike in the tax charged to oil companies on profits would realistically be easily absorbed, but to a small business a four per cent drop in business tax could mean be the difference between putting food on the table and going hungry. However, it is possible and even likely that they would pass this along to the consumer as just about every other tax increase to oil companies has been in the past.
I know most of us will grumble about having to pay more when we gas up, but there is so much potential here to solve our budget shortfalls, and chronic under-funding. If the government taxed their profits – heavily – at the end of the day, that money would be returned to the public.
And why stop taxing there? Last year Quebec became the first province in Canada to levy a pollution tax on oil companies, at about one cent per liter. That’s a great start, but why not more? Why not charge them five cents per liter? They are among some of the worst polluters in the country, so why not make them pay? Certainly they can afford it.
According to Alepin, the percentage of profit taken in by oil companies in Canada is far above the world average. By upping their tax, in the very least to equal what other large corporations of their size already pay, the government would also be provided with an invaluable new source of income. Kiss all of our infrastructure and health care funding problems goodbye. Finally after taking so much, the oil companies would be forced to give something back; we’d have a much easier time paying our doctors, nurses and teachers, fixing our infrastructure, and properly funding social programs.
Why should the government and by extension all Quebecers and Canadians alike be forced to live with an ever-tightening budget and a crumbling infrastructure and health-care system while oil companies continue to rake in record profits each quarter? It’s not right, and it is time for the government to stand up and put them in check. It’s about time the feds stood up for the people who elected them, and not just the lobbyists who fund their campaigns, because what good is an election campaign when you have no public support?
They need to be reminded of who’s in charge here. But don’t hold your breath, because change comes painfully slow when it comes to politics and policy.


Related Posts