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No quick fix for B.C.'s high gas prices after BCUC Inquiry

Last Updated Aug 30, 2019 at 6:32 pm PDT

Summary

Bruce Ralston, the minister of Jobs, Trade and Technology, calls it "gouging" that costs consumers $490-million a year

Meanwhile, Opposition Liberals are again demanding some kind of tax relief

Antweiler says the recommendations of regulating prices is "near-sighted"

VANCOUVER (NEWS 1130) – B.C.’s New Democrats are blaming the former Liberal government for a lack of competition in gas pricing.

Bruce Ralston, the minister of Jobs, Trade and Technology, calls it “gouging” and it costs consumers in this province $490-million every year.

“Added costs that B.C. consumers are paying without any apparent economic justification other than their own profit,” he says. “People feel like they’re being ripped off when they fill up at the gas station, and they’re right.”

Ralston is accusing the BC Liberals of trying to derail the BC Utilities Commission inquiry instead of working with the NDP to make the oil industry more transparent.

“There are other jurisdictions where there is much more information required to be publicly disclosed. The thing about the wholesale prices, the way in which it is set, is pretty mysterious. It’s a backroom thing,” he says.

He adds sometimes public scrutiny can have an affect on market players. Although it is still early to say what steps will be taken to address the report.


Meanwhile, Opposition Liberals are again demanding some kind of tax relief.

Kamloops-North Thompson MLA Peter Milobar says taxes cost Greater Vancouver drivers more than the entire refining and retail process.

“It’s very disappointing that the premier has chosen to not try to bring any relief to people over the summer. Instead we have a report that tells us exactly what we knew ahead of time,” he says.

With gas prices fluctuating daily, Milobar understands there is a supply and demand aspect, but says the government has control over taxation, and the premier could control the two provincial taxes on gasoline before the report.

“Here we are two summers of record high gas prices, the premier taking zero action under his watch to try and make life more affordable for people as they go to the gas station to fill up. Instead of taking any action on their policies or taxation, he actually handcuffs the commission to look at those things,” he says, adding he isn’t surprised with the report’s findings.

“Without being able to look at government taxation and government policy, there’s no wonder there’s a missing 13 cents a litre the commission was unable to account for,” Milobar says.

RELATED: BCUC finds no evidence of collusion in gas price inquiry

Professor of economics at UBC’s Sauder School of Business, Werner Antweiler, says a tax relief would only be temporary.

“The problem is, once you start regulating [the market], they will start to under-provide the service. That is not something we would like to see in terms of shortages at the pump,” he says.

Antweiler adds the inquiry’s recommendation of regulating prices is “near-sighted” since the gas market is well-understood, regardless of what politicians say. He says tax relief at the pump is only an illusion since the gas revenue mostly goes to TransLink and supporting public transit.

“If you lower the carbon tax, we would not fulfill the federal mandate. All in all, there’s so little room to maneuver on the tax side that it would be a fallacy to suggest there is anything we could offer reasonably to motorist,” he says.

He says cutting taxes only gives companies the opportunity to raise their profits, and the price we pay at the pump is driven by supply and demand.