Fuel Tax Re-allocation

Res #: 28-12A
Number: 28
Year: 2012
Midterm: No
Expired: Yes
Responses Received: No
Departments: Saskatchewan Ministry of Finance

WHEREAS the Fuel Tax is collected as general revenue for the province; and

WHEREAS diesel equipment that is stationary and not driving on Saskatchewan roads is currently paying the Fuel Tax; and

WHEREAS the Fuel Tax for fuel consumption of off road equipment is unfair;

BE IT RESOLVED that SARM lobby the Government of Saskatchewan to re-allocate fuel tax used by off road equipment to municipal road construction and maintenance.

Response from Honourable Ken Krawetz, Deputy Premier, Minister of Finance:

Support to municipalities is provided through a general revenue sharing formula, equal to one full point of Provincial Sales Tax, which is unconditional and can be used for either operating or capital purposes. For 2012-13, municipal revenue sharing will equal $237.4 million. This represents an increase of $20.6 million, or 9.5 per cent, from 2011-12.

This method of funding is a clear and accountable mechanism which allows municipalities to make autonomous fiscal decisions based on local priorities.

Finally, I would like to note that the 2012-13 Budget provided $23.5 million in funding for the Municipal Roads for the Economy Program (MREP) through the Ministry of Highways. This funding is targeted at building and upgrading rural roads and bridges that support economic and social development in the province.