Provincial Finance Minister Alan McMaster told reporters Wednesday that the federal government is barring any province from lowering the tax because it would be seen as an offset to the federal carbon tax, which has not yet been imposed in Nova Scotia. “They just said we can’t do it.” MacMaster said at Province House. “There’s a federal document that says you can’t go and offset carbon pricing, because that would defeat the purpose of what they’re trying to do, which is trying to raise the price of fuel so people stop buying it.” But Fraser, the MP for Central Nova and immigration minister, says Nova Scotia is free to follow the lead of other provinces that have lowered provincial fuel taxes as a measure to alleviate inflation, not as a way to circumvent federal law. “There have been provinces that have done this,” Fraser told the CBC in a phone interview Thursday. “In fact, both the government of Newfoundland and Labrador and the province of Ontario.” “If the province just wants to lower the fuel tax, within the provincial jurisdiction, it’s free to do that, as both the provincial Conservative and Liberal governments have done in different parts of Canada,” Fraser said. MacMaster suggested that Newfoundland and Labrador was given permission by the federal authorities because it has a Liberal government. Ontario, however, has a Conservative government. Fraser also disputed MacMaster’s suggestion that cutting the provincial fuel tax against Ottawa’s wishes could cost the province dearly. Nova Scotia Finance Minister Alan McMaster said he can’t cut a gas tax that puts about $260 million into the province’s coffers each year because the federal government won’t allow it. (Robert Short/CBC) “The federal government, we depend on it for a significant source of revenue that comes into the province,” MacMaster said Wednesday. “So there are transfer payments, health transfer, social transfer.” Fraser called the proposal that Ottawa would cut health transfers, or federal funds that help pay for post-secondary education, social assistance, early learning programs and child care, an attempt to “rob people of their vulnerabilities.” “There’s an effort to scare Canadians into believing that the federal government is going to cut health care spending, when in fact every indication is that we’re going to increase health care spending,” said Fraser. “At a time when people are worried about the quality of health care, they’re worried about affordability, this kind of effort to instill fear in people instead of promoting policies that will serve their interests is disappointing, to say the least.” The provincial tax, officially known as a motor fuel tax, is expected to raise nearly $260 million for the Nova Scotia government this year.
