Legault nixes cutting gas tax, saying that cheques to households will offset spiralling cost of living

Longueuil, Que. -

Quebec Premier François Legault acknowledged Tuesday that inflation is hitting households hard, but he said he has no plans to freeze rates or cut the gas tax, as Conservative Leader Éric Duhaime is calling for.

Passing through Longueuil to launch the campaign for his candidate Shirley Dorismond in the April 11 by-election in Marie-Victorin, Legault repeated his intention to use the March 22 budget to hand out cheques to taxpayers.

"I see the opposition suggesting freezes: freezing hydroelectricity [rate] increases, freezing rents, removing gasoline taxes," he said.

"I think what it means, if we did that, is that we would help more those who consume more," he said.

But the government's approach has been intended to disproportionately help people with less money, he said: "to give an amount that is fixed for everyone and which, therefore, helps more the people who need it the most, who have less income."

The premier said the same on February 25 in Repentigny. 

"This is the approach we favour, so we do not favour freezing or removing taxes, which would benefit those who consume the most."

THE ALBERTA DEBATE

Earlier in the day, Duhaime had asked the CAQ government to imitate Alberta and temporarily suspend the provincial gas tax. The situation in Alberta, however, is very different.

Such a suspension in Quebec would deprive the government of significant revenue. On the other hand, Alberta is benefiting from a major increase in the royalties it collects for the oil extracted on its land, since the price of a barrel has gone up.

These royalties, which were one per cent when the barrel was selling at $55, gradually increased to reach their expected peak of nine per cent since the barrel reached $120.

In dollar terms, the province's revenue increases by $400 million to $500 million for every dollar a barrel goes up in price, experts say.

However, the price of a barrel has increased by more than $65 since January 2021. The loss of revenue from the Alberta provincial gas tax will therefore be largely offset by the meteoric rise in royalties for a little more than a year.

TACKLING INFLATION 

Legault has also indicated that in the coming weeks, "we will talk about inflation. I think this is a subject that is becoming more and more unavoidable," he said.

"We have seen the price of housing. It's true, there is a lack of housing in Longueuil, including affordable housing."

He acknowledged that it is necessary to use, as soon as possible, federal funds allocated for the construction of affordable housing, a $338 million pool from a project called the Initiative for the Rapid Creation of Housing (ICRL).

"We need to reduce construction time," he said. "The idea is to go faster."

He repeated his earlier goal to "put money back in the pockets of Quebecers, because it is not only those who need affordable housing who have problems. Middle-class families are also struggling to pay rent increases," he said.

"It's not just affordable housing where there's a problem. It's all housing," he said, adding that grocery costs have also seen runaway inflation.

Legault also noted that the hope of becoming a homeowner is becoming more and more an inaccessible dream for young couples due to unprecedented overbidding on the real estate market.

He indicated, however, that there will be no measures devoted to this issue in the next budget and that it will come up instead, most likely, in next fall's election campaign.

"There is a campaign coming up for the general elections," Legault said. "I think the political parties will push themselves to have home ownership plans, as we have often seen in history. I ask you to be patient."

This report by The Canadian Press was first published in French on March 8, 2022.