The CEO of Air Canada has hit out at Ontario lawmakers’ proposal to increase aviation excise fuel taxes, saying the proposed tax hike will hit the Canadian airline industry hard and damage the economy.
"Ontario will continue to lose business to US border airports and other provinces with more progressive perspectives on economic development," said Air Canada CEO Calin Rovinescu.
A Conference Board of Canada study recently said up to 5 million Canadian air travelers annually drive to US border airports to avoid paying the higher departure taxes.
Rovinescu said the proposed tax increase will cost Canadian aviation an extra $100 million.
Ontario already has the highest excise tax on aviation fuel in North America, he said.
The proposal by the Ontario government is to almost triple the rate of excise fuel tax, which will ultimately be passed on to air travelers.
Rovinescu has backed opposition to the budget proposal and believes it is nothing more than a "facile source of revenue to subsidize other government initiatives."
