BC workers who drive to work say gas refunds aren’t keeping up with soaring prices

Jacquie Woolley travels more than 50 kilometers a day for her job as a mail carrier for Canada Post in the city of Prince George, in northern British Columbia.

Woolley says she was spending $65 a week on gas for work. Now she spends $115 a week, but the amount she gets reimbursed has stayed the same.

“I’m paying to do my job right now,” she said.

Woolley is one of many British Columbians struggling with soaring gas prices, which have hovered around $2 a liter in most places in the province, while using their own vehicles for work.

Each year, the Canada Revenue Agency (CRA) establishes a federal mileage rate, or standard allowance per kilometer for employees who drive their own vehicle as part of their job. The 2022 kilometer rate is set at $0.61/km for the first 5,000 kilometers traveled, then drops to $0.55/km thereafter.

For Woolley, that means she pays out of pocket $45 to $65 a week on top of her vehicle allowance to make the deliveries.

It changed her life in many ways, she says.

Woolley, who has been a Canada Post mail carrier for 21 years, says she and her husband have cut back on groceries, no longer have weekly appointments and won’t be able to travel this summer.

A gas station in Prince George, British Columbia is shown here. The province has some of the highest gas prices in the country, hovering around $2 per litre. (Andrew Kurjata/CBC)

If nothing changes, Woolley says she’ll have to make do with the lifestyle changes until she can officially retire in eight years.

“If that means we’ll be eating mac and cheese for the next eight years, I guess that’s what we’re eating,” she said.

She hopes the government will raise the mileage rate in light of rising gas prices, or at least give affected employees a tax break.

“Something has to give somewhere, and it can’t always be us.”

Temporary increase in mileage rates

Postal workers across British Columbia are being hit hard, says Coleen Jones, Pacific Region Director at the Canadian Union of Postal Workers (CUPW).

In northern communities, Jones says, some have to travel more than 175 kilometers a day to deliver the mail.

“[Postal workers] are now subsidizing the companies they work for,” she said.

Gasoline reimbursements made to employees at the standard mileage rate are not taxed. Employers can choose to offer workers a different rate, but if they do, those payments are considered taxable income by the government.

“Even if the companies paid them more, then that vehicle allowance becomes completely taxable — even the things that are below 61 cents,” Jones said.

The union is calling on the CRA to temporarily increase mileage rates by at least 15% until the average gas price drops below $1.75 per litre.

The CRA did not respond to CBC’s request for comment.

Other sectors affected

The kilometer rate has also affected employees in other sectors.

Stephanie Smith, president of the British Columbia Government Employees Union (BCGEU), says thousands of their members use their own personal vehicles for work, including community health and social service workers .

“At the moment the [mileage rate] is far from covering the cost, so our workers are paying to go to work,” she said.

Even in denser areas such as the Lower Mainland, where driving distances may be shorter, community health workers still have to travel up to 100 to 200 kilometers per week to perform their jobs, she adds.

“Workers shouldn’t pay to go to work, and we need the government to find a solution for workers.”

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