License plate fees could be eliminated before Ontario’s June election
In a populist pre-election move, Ontario Premier Doug Ford is seeking to eliminate vehicle registration fees, CTV News Toronto has learned, saving millions of drivers $120 a year.
Sources say the plan comes from the Department for Transport and was presented to ministers at a recent meeting with a public unveiling of the planned cost-cutting measure in the coming days.
Sources said on Tuesday that while the government would eliminate fees associated with license plate renewals for passenger vehicles, light commercial vehicles and motorcycles, motorists would still be required to replace stickers on an annual basis.
License plate renewals are often used as an enforcement mechanism for unpaid parking tickets and 407 fees. Sources said the government wanted to ensure municipalities still had the ability to recoup costs, whether businesses could check a driver’s unpaid fines and police departments could continue to enforce traffic rules.
While eliminating the fee would benefit more than eight million drivers each year, it would also represent a multimillion-dollar blow to Ontario’s finances.
In 2018-19, Ontario’s Financial Accountability Officer (FAO) reported that vehicle and driver registration fees brought in $1.95 billion into government coffers, but the program has ended up costing $2.4 billion that year, leaving $436 million in lost potential revenue.
The revenue loss would come at a time when the government is facing a post-pandemic deficit of between $16 billion and $20.5 billion – figures from the FAO and the Ministry of Finance respectively.
Sources said the government will also reimburse Ontarians who have renewed their license plate stickers. The list of people eligible for reimbursement is not yet finalized.
The government is studying how these refunds could be issued and it may be similar to the direct deposit system used for the Department of Education’s Covid-19 student funds.
The move to scrap license plate fees comes 16 weeks before the provincial election, in which the Progressive Conservatives face a tug of war with the NDP and Liberals – and face a potential haemorrhage from Progressive supporters – conservatives towards more right-wing options.
A source said Ontario PCs were looking to build voter support in the Greater Toronto Area area code 905 region, which helped secure a majority in 2018.
Effective immediately, Ontario drivers must renew their expired license plates by February 28.
The government has allowed people to use expired license plate stickers since March 2020 to prevent people congregating at Service Ontario locations.
With files from Sean Davidson and Cristina Tegnalia CP24 from CTV News Toronto