New tax driving Ontario airline tickets sky high

July 23, 2014

QUEEN’S PARK –Haldimand-Norfolk MPP Toby Barrett believes the government’s new aviation tax could have a direct impact on the riding.

Ontario already has one of the highest taxes on aviation fuel amongst neighbouring provinces and adjacent American states at 2.7 cents per litre. As part of the budget, aviation fuel tax will raise to 6.7 cents per liter by 2017.

“Hamilton Airport offers 29 different destinations, plus significant air freight capability,” Barrett said. “With this new tax, how much business will go to Buffalo?”

Testifying at budget committee hearings, Marc-Andre O’Rourke, executive director of the National Airlines Council of Canada, told committee members the detrimental effect an aviation fuel tax hike could have on Ontario. British Columbia eliminated its fuel tax on international flights to attract new services and jobs in 2012. Since then, 22 airlines added Vancouver flights.

“If Ontario’s aviation fuel tax goes up by 148 per cent, such as proposed, the consequences for the province’s economy will be significant,” O’Rourke told the committee. “This tax increase could also mean a loss of more than 2,000 jobs and 400,000 air travellers in Ontario. By 2030, the catalytic effect of this four-cent increase could cost the province up to $1 billion in lost GDP.”

O’Rourke also pointed out Canada is already one of the least competitive jurisdictions in the world when it comes to high fees and taxes on flights.

“I have long said Premier McGuinty never met a tax he didn’t like,” Barrett said. “It looks like Premier Wynne is following in his footsteps. Again, how much business will this tax propel across the border from Toronto and Hamilton airports.”


For more information, contact MPP Toby Barrett at 519-428-0446