For a large number of Canadians, trips to the gas pump are not an option, and take up a healthy chunk of a monthly budget. With the costs surrounding owning a car already considerable, high gas prices are an inconvenience that no one wants to put up with anymore.
When there is a small change in demand when prices change a lot, the product is said to be inelastic. Gasoline is the general example used when talking about inelastic demand.
In Canada’s case, a big change in prices has put yet another dent in the pockets of Canadians everywhere. Drivers will have to put gas in their vehicles no matter what, as there are no alternatives available to the standard consumer.
When gas prices are high, we are all worse off. There are no substitutes to black gold. The public conscience has noticed that gas prices have been high for years now, and with the Trudeau government strongly in favor of a carbon tax, dots begin to be connected. People do not want to pay more for goods, and if their own government is in favour of charging more, that is not a government we are interested in reelecting.
Every time a Canadian passes a gas station and sees huge numbers showing high gas prices, it’s basically free advertising for the Conservative Party. It says to voters, “look at how your current government grabs at your pocketbook.” A government that wants to keep on adding taxes to an already high price.
The carbon tax affects consumer behavior like any other form of taxation. It creates a drag on the economy that does not need to be there in the first place. It is dead weight that should be cut off and left behind, but for whatever reason, the Liberals feel as though it is beneficial.
Loss in economic efficiency is the main concern to some, but apparently to the Trudeau Liberals, it’s a non-factor. Taxing a commodity like energy only supercharges the economic drag, and spreads it throughout the economy.
In 2016, an access to information turned up a Finance department memo that admitted that the total economic of a carbon tax would be uncertain, but that it “would cascade throughout the economy.”
Other memos have noted that the carbon tax will only work once it’s raised to more than $100/tonne. Some reports say that $300 is the correct amount to see any effect on energy consumption, but by that time, most Canadians would be cooking dinners over oil drums, anyway!
Conservative Party Leader Andrew Scheer has been a strong and vocal advocate against the carbon tax, and states that he would scrap the carbon tax if he becomes prime minister in the coming federal election.
And make no mistake, Canadians absolutely feel the burden of taxes, moreso than any other expenses. According to the Financial Post, in 2016, the average Canadian family (including single Canadians) “earned $83,105 in income and paid $35,283 in total taxes.” 42.5 percent of income earned going directly to taxes. After paying off all of your hydro, internet, cell phone(s), mortgage and car payments, which include gas and insurance, it’s no wonder that a message that revolves around lower taxes would resonate well with voters.
The numbers add up quickly, and it’s easy to see how our government drains our pockets of our hard earned cash. “The average Canadian family spends 22.1 per cent of its income on housing — only about half as much as it spends on taxes. In fact, taxes consume more of the average family’s income than all the basic necessities of life combined. If you add up the average family’s spending on housing, food and clothing in a year, it comes to 37.4 per cent of its income.”
It could be seen as brash, but based on the amount of taxes taken from us, our government believes they can spend our tax dollars better than we can ourselves.