October 2008—Let’s All Take a Minute to Give Thanks for Trucks

By Paul R. Landry, President & CEO BCTA

Most of us who travel B.C.’s roads know that they carry large numbers of trucks of all sizes.

What we may not consider is that the loads those trucks are moving will end up in our homes or offices or at local hospitals or banks through an efficient supply chain that transfers goods from manufacturers, distributors, farmers, importers and other suppliers to locations that serve us all.

In honour of National Trucking Week, which fell from September 7th to 14th this year, let’s take a minute to think about the trucking industry and the thousands of men and women who work within it to make our lives functional, comfortable, healthy and safe.

While we’re just getting up, trucks have already visited grocery stores, restaurants and fast food outlets to deliver both fresh and packaged foods.

If you commute by car or take transit to work, trucks help get you on your way. They deliver gasoline and diesel to service stations and to bus, air, rail and marine terminals throughout the province. Because a truck got there, you’ll get where you need to go too.

If someone you love is due for a hospital stay or cared for in a nursing home, you have trucks to thank in part for their clean, safe, well-stocked surroundings. Many hospitals have meals delivered daily. Trucks also deliver clean, sterile sheets and gowns and pick up soiled articles for treatment. Medications, radiopharmaceuticals and oxygen all come in by truck.

Trucks whisk domestic garbage and recycling away from curbsides or drop-off depots. They move potentially toxic biomedical and hazardous wastes – batteries, oil, asbestos and solvents – to facilities where they can be treated and disposed of. The livability of our communities and homes is enhanced because trucks are on the job.

In addition to our day-to-day reliance on the industry, we also benefit from its contribution to the economy of both B.C. and Canada. Here are a few facts:

· In 2005, trucks transported 66.7 million shipments across Canada, carrying 6.15 billion tons of cargo.

· Trucking is the link that allows other transportation modes to work together. Marine, air and rail transportation need trucking to complete the chain to and from their terminals.

· In 2006, trucking was a $1.67 billion industry in B.C., with a growth rate of 4 percent a year between 1997 and 2006. The growth rate of all other B.C. industries combined was less than 3 percent.

· The Pacific Highway border crossing in

· Surrey, the sixth busiest in Canada, saw $7.2 billion worth of exports and $6.8 billion of imports in 2006.

Between 2008 and 2012 are as follows:

What will the BC Government’s carbon tax cost you and your company? Use BCTA’s Carbon Tax formula to find out:

A x B – C = Net Carbon Tax Payable

Where: (A) is the estimated number of litres of diesel consumed in the next 12 months (July 2008 to June 2009) for your entire fleet.

(B) is the carbon tax payable per litre. For this year, (B) is .0269 dollars per litre (i.e., 2.69 cents per litre). See Table 1 on page 14 for following years.

(C) is the amount of your tax reduction (i.e., one of the tax measures meant to create revenue neutrality) for the year.

·  If your business is unincorporated and you file a personal T1 tax form, (C) is the 2008 Tax Reduction listed for your taxable income in Table 2 on page 14.

·  If your business is incorporated and you file a T2 corporate tax return, (C) equals one percent of your profit.

Complete the calculation to estimate your net carbon tax payable.

Examples:

1. An owner-operator providing long-haul services with only one vehicle drives an average of 175,000 kilometres (km) per year with fuel consumption of about 60 litres per 100 km. The net carbon tax payable would be: 105,000 L x $.0269 - $20 = $2804.50

(A) = 105,000 litres/year (60 L/100 km x 175,000 = 60 x 1750 = 105,000 L)

(B) = $.0269 dollars (the carbon tax rate)

(C) = $20, the tax reduction for an unincorporated owner-operator with a taxable income of approximately $30,000 per year (from Table 2 on page 14)

2. A 40-truck carrier generates just over $10 million in revenue in B.C. Of that total, five percent, or $500,000, is taxable revenue. Post-July 1, 2008, the carrier will receive a corporate tax cut of one percent, or $5000, on that amount.

BC Carbon Tax Facts By British Columbia Trucking Assn.

The annual volume of diesel consumption by medium and heavy-duty trucks: 1,570,838,764 litres.

· Diesel consumption rises an average of 3.5%1 per year.

· The carbon tax on diesel fuel is 15% higher than for gasoline, purportedly due to the fact that diesel emits a higher proportion of carbon per litre consumed.

· Carbon tax rates and the total tax to be paid by operators of medium and heavy-duty trucks

British Columbia Tax Cuts implemented to help create a revenue neutral tax:

Personal Tax Cuts: see table on right

Corporate Tax cut: by 1%, from 12% to 11%

Small Business Tax Cut: by 1%, from 4.5% to 3.5%

1The BC Government estimated 2% growth in fuel usage per annum when developing their projections.

2The BC Government has not announced tax reductions beyond 2009. On June 28, 2008 they publicly speculated that future tax cuts are in jeopardy because of projected reduced revenue streams.

Text Box: EMPIRE TRUCK PARTS 
(1985)  LTD.

Specializing in 
ALL Heavy Truck Parts
Transmissions, Rear Ends, Diesel Engines

(403) 272-3319
Fax: 1-403-273-3106

2820-52 St. SE
Calgary, Alberta

Taxable Income

2008 BC Tax (Before cuts)

Tax Reductions 2008

Tax

Reductions

20092

$20,000

$233

$11

$28

$30,000

$1,015

$20

$55

$40,000

$1,654

$34

$90

$50,000

$2,455

$51

$134

$60,000

$3,270

$68

$179

$70,000

$4,085

$85

$224

$80,000

$5,134

$85

$224

Taxable Income

2008 BC Tax (Before cuts)

Tax

Reductions 2008

Tax

Reductions

20092

$20,000

$233

$11

$28

$30,000

$1,015

$20

$55

$40,000

$1,654

$34

$90

$50,000

$2,455

$51

$134

$60,000

$3,270

$68

$179

$70,000

$4,085

$85

$224

$80,000

$5,134

$85

$224

Date

Carbon Tax Rate

 

Carbon Taxes

(Current consumption levels)

Carbon Taxes

(Consumption increases at 3.5%

per year)

08-09

2.69

$42,255,561

$42.255.561

09-10

4.04

$63,461,883

$65,683,048

10-11

5.38

$84,511,122

$90,530,426

11-12

6.73

$105,721,480

$117,215.280

12-13

8.07

$126,766,680

$145,467,660

Five-year totals;  

$422,716,726

$461,151,975