Canada Post slaps on stealth fuel tax
Ottawa — Businesses will be outraged to learn that Canada Post has quietly slapped a new fuel surtax on the delivery price of parcels and courier packages, says the Canadian Federation of Independent Business.
The 2.25 per cent surcharge was introduced by Canada Post on a range of parcel and courier delivery services last week to cover high fuel costs.
But the fact the Crown corporation so quietly introduced the new charge is bound to anger operators of small- and mid-sized business, who are already facing too many rising costs, said Garth Whyte of the federation.
"This is a stealth tax, really," he said. "They're slipping it in."
He estimates the new charge will net Canada Post about $25-million, based on an annual business of $1-billion.
"They should have announced this publicly ...they've given us no advance notice," said Whyte, whose group represents almost 200,000 businesses.
"This is just an excuse to get more money."
The new charge, which took effect without fanfare April 7, adds about 22.5 cents on a $10 delivery cost for a regular or expedited parcel, Xpresspost, or Priority Courier package.
Canada Post said notice of the surtax is highlighted on the company's Web site and notices have been put up in some post offices.
It also said that while other courier companies have had a fuel surcharge for some time, it delayed adding the surtax as long as possible and only buckled under the pressure of rising expenses to run its fleet of delivery trucks.
"The continued escalation of fuel prices has significantly raised the costs of transportation and that's a big part of our business, obviously," said Canada Post spokesman John Caines.
"All of our product goes on highway service or on planes."
The war against Iraq, political troubles in Venezuela and other global problems have all driven up the price of oil in recent months, at times well over $30 (U.S.) a barrel.
It's hoped that with some of those worldwide tensions easing, fuel prices will begin to moderate.
If fuel costs drop dramatically in future, the company many unwind some of the costs, which will be reviewed every two months, said Mr. Caines.
But Mr. Whyte wasn't buying the fuel price argument.
"Sure, their costs have gone up, but so has everyone else's," he said.
Mr. Caines said the new charge won't affect the price of stamps for regular mail because changes to regular postage costs are linked to inflation.
But Mr. Whyte said he suspects the new surcharge on courier and parcel delivery services may be used to offset other postage costs.