Mar 2011 12

The Economy of British Columbia Endangered by Cheaper Southern Gas

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Photo by Mike Bitzenhofer Photo by Mike Bitzenhofer

According to The British Columbia Automobile Association (BCAA), many people are driving over the border to get cheap gas. If this trend continues, it might damage BC’s economy.

Since the Canadia Dollar is currently well above the American Dollar, many people are finding it worthwhile to cross the border and visit the United States to fill up. On average, one third of what we pay at the pump is taxes. Thus, as Trace Acres of BCAA says: “That’s a concern for TransLink because the more people are buying gas south of the border, the less they’re buying here and then the less tax they’re paying here as well.”

The Greater Vancouver area has the highest gas taxes in all of Canada. US taxes on gas are just a small fraction of what we pay here, so it is understandable that there are such high numbers of people heading south to buy gas. The economy may also be negatively affected as Canadians likely engage in some cross-border shopping while getting gas.

Back in 2008, when gas prices rose to about $1.50 per litre, we observed a striking increase in ridership on buses and the SkyTrain, and even the number of people taking the West Coast Express went up 25 per cent. TransLink anticipates sales of transit passes to rise as drivers compensate for enormous gas prices. Drew Snider of TransLink says: “TransLink won’t ever consider lowering the price of transit passes when gas prices are high, either as an incentive or just to help people out.”

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