The Saskatchewan government announced it will be adding an annual tax for owners of electric vehicles (EVs).
Revealed in the 2021-2022 budget tabled Tuesday, the new $150 annual tax is being introduced to “improve tax fairness”. The government says the money will be used to ensure EV owners contribute to road maintenance and replacement that would otherwise be funded though the provincial fuel tax.
“These vehicles contribute to wear and tear on provincial roadways, but because they do not consume traditional fuels they are not contributing to highway maintenance through the provincial Fuel Tax.”
With the number of EVs in the province currently hovering around 400, the government estimates it will collect an extra $60,000 annually from the tax.
The extra revenue won’t come close to making up for the $162 million shortfall last year. In 2020 $454 million was collected from road-use Fuel Tax revenues, while the government spent $616 million on road maintenance.
The new tax will become effective October 1, 2021 and will be collected by Saskatchewan Government Insurance (SGI) when the EV is registered.
UPDATE: The SaskEV Association has published a press release responding to announcement of the new tax. Founded by Jason Cruickshank, SaskEV says the new tax, the first of its kind in Canada, impacts less than 1% of all drivers in the province and is in direct contradiction to the federal government’s efforts to increase EV adoption.
The association points out Saskatchewan has put no money towards public EV charging infrastructure, and unlike several other provinces offers no incentives to EV buyers. British Columbia, which has invested heavily in both incentives and charging infrastructure, announced today it has the highest rate of EV adoption in North America.
You can read their full statement here.