Without exception, individuals and non-profit organizations were of the opinion that the ordinary residents of the Northwest Territories, not the resource or trucking sectors, would ultimately shoulder the trip permit fees and that these fees would have significant impact upon seniors, the disabled and fixed- and low-income earners. The committee heard from the majority of presenters that Bills 9 and 10 should be scrapped and other options considered. All presenters agreed that the roads need improvement, but this strategy is the wrong way to do it.
Presenters noted resource companies would be able to deduct the trip permit fees from their gross taxable income. Trucking companies would not absorb the fees as they are in the business of making money and will have to recover their costs. These fees, further increased by costs relating to their complex administration, will be passed on to their customers who in turn recover their costs from the final consumer, the residents of the Northwest Territories. As the goods are transferred from one party to another, costs are increased by the inclusion of GST and other overhead such as supplementary paperwork, which significantly increases the ultimate costs of goods.
In its written and oral submissions to the committee on October 12, 2001, the Hay River Seniors' Society concluded that:
The road tax, or trip permit fee, will be applied universally and its impacts on our economy can be potentially devastating, whether it is a package of chewing gum or fuel to heat your home. This tax, or fee, reaps rewards; but this revenue will be converted into higher costs that are passed onto consumers.
With an increased cost to people receiving social benefits and those living on fixed income, including seniors, this plan offers great peril... for us on fixed income, it is a double whammy. We must first absorb the increased cost of living through belt tightening.
This is further supported by a presentation made by the Northwest Territories Trucking Association on October 17, 2001, in Yellowknife, which stated:
Transportation is an essential service. It is a significant component of the high cost of living in the North, a cost that includes food, shelter, heat, clothing and other essentials. The proposed toll fee will increase these costs further.
Our Finance Minister says it will add $300 per year for a family of four. The actual cost increase will be about four to five times higher for a family in Fort Good Hope than it will be for a family of four in Hay River. The recently approved increase to our cost of living tax credit will give additional relief of $177 per year for our wealthiest citizens and less than $100 for a family with a net taxable income of less than $35,000. (Speaking notes for a presentation by the Northwest Territories Trucking Association to the Standing Committee of the NWT Legislative Assembly, October 17, 2001, page 2)
Furthermore, only a small portion of goods and services purchased by the average Northwest Territories household was taken into consideration by the government in its impact analysis of the fee upon Northwest Territories residents. In a study commissioned by the Chamber of Mines for the Northwest Territories and Nunavut, it was reported that:
The government provides data only for the impact on groceries, heating fuel and motor fuel which, according to Statistics Canada, accounts for only 20 percent of the 1998 Northwest Territories household expenditures. It does not take into account the fact that all goods and services, such as cars, building materials, air tickets, et cetera, in the Northwest Territories households would be impacted by the tax or fee.
The exclusion by the government of 80 percent of the goods and services purchased by the Northwest Territories households in their cost analysis significantly understates the impact of the road tax on Northwest Territories residents. (A Review of the Proposed Road Tax on the NWT Economy, Preliminary Report -- A Report Prepared by Ellis Consulting for the NWT and Nunavut Chamber of Mines, October, 2001, page 2)