Sask. govt. criticized from left and right for not cutting taxes

Saskatchewan's 2023-24 budget boasts a $1-billion surplus, but no substantial tax relief. That has the government facing criticism from both sides of the political spectrum.

On Wednesday, Finance Minister Donna Harpauer announced thesurplus, saying revenues would be buoyed by strong non-renewable resources and higher tax revenues. Despite having$2.5 billion more in revenue than in 2022-23, the government chose to hold the line on taxes and has decided to pay down $1 billion in debt.

In question period on Thursday, both the Opposition NDPLeader Carla Beck and Saskatchewan United Party Leader Nadine Wilson asked why the government did not cut taxes.

"How is it after years of tax hikes, this premier couldn't find one single measure as he sits on a $2 billion windfall?" Beck asked.

"Last year the affordability tax credit was put out. [There are] investments where we aligned with the federal government to deliver low-cost child care. Inthis particular budget there is a six per cent lift to the social income assistance program," Premier Scott Moe said in response.

Moe also referenceda 20 per cent increase to the Personal Care Home Benefit and a six per cent increase to the Saskatchewan Assured Income for Disability benefit.

Beck responded by saying that since the PST was increased and expanded in 2017, families "are paying almost $1,000 more in PST."

Beck argued that with the high surplus, PST could have been rolled back on entertainment tickets, children's clothingand used cars.

"Today, yes we have a PST of six per cent in this province, a far cry from nine per cent as it was under the New Democrats," Moe said.

Later on in question period, Wilson asked why the government didnot decrease taxes "in light of this surplus?"

"I have spoken to this a number of times to all of themedia outlets. It's aquestion that people are asking of, why you don't decrease taxes when you have a surplus? We have in the past, and government's of both stripes have relied on resources to balance our budgets, but those prices are very volatile. They go up and, unfortunately, they go down," Harpauer said.

She continued arguing that if the governmentbakes inone-time revenue increases into year-over-year spending, or cuts taxes, and then loses base revenue,"they run into trouble."

"I have committed that I do not want to do that as a finance minister. This government does not feel that is responsible."

The Buffalo Party of Saskatchewan also called on the government to reduce taxes. Leader Philip Zajac called the budget a "smoke screen" and asked why there was "no tax relief for the people of Saskatchewan." He pointed to the tax on used vehicles, sports and events.

"No suspension of the fuel tax that would help every citizen in Saskatchewan immediately," Zajac said.

SaskatchewanLiberal Party Leader Jeff Walters called the budget "the one inflation ate."

The government did remove PST on the following:

• Labour to install and repair medical equipment.
• Produce storage buildings.
• Rice-harvesting boats and equipment.
• Geothermal drilling rigs.

Could tax cuts be on the horizon?

Tax reductions or cuts are not happening this year, but Harpauer did not rule out changes in the future.

"I have a lot of optimism we are going to get there though, because there is a large private sector investment for growth in our province," Harpauer said Wednesday.

She said the government does not want to rely heavily onnon-renewable resource revenue for its bottom line, so reducing taxes would change the calculation.

Of Saskatchewan's projected $19.7 billion in revenue, $9.6 billion is tax revenue, up $1.5 billion from the 2022-23 budget.

Non-renewable resource revenues are projected at $3.3 billion, up $434 million from 2022-23.

The government is projecting a dip in commodities over the short term. Harpauer said forecasters also expect inflation to "come down."

If having an extra billion dollars does not prompt a tax cut or deduction, the Saskatchewan Partygovernment may be waiting until March 2024.

Voters will head to the polls in the fall of 2024. With parties of all stripes calling for tax cuts, the government may be keeping its powder dry for 12 months before offering goodies next year, in its last budget before an election.