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  • Study explores media coverage of pipeline controversies December 14, 2018
    Supporters of fossil fuel infrastructure projects position themselves as friends of working people, framing climate action as antithetical to the more immediately pressing need to protect oil and gas workers’ livelihoods. And as the latest report from the CCPA-BC and Corporate Mapping Project confirms, this framing has become dominant across the media landscape. Focusing on pipeline […]
    Canadian Centre for Policy Alternatives
  • Study highlights ‘uncomfortable truth’ about racism in the job market December 12, 2018
    "Racialized workers in Ontario are significantly more likely to be concentrated in low-wage jobs and face persistent unemployment and earnings gaps compared to white employees — pointing to the “uncomfortable truth” about racism in the job market, according to a new study." Read the Toronto Star's coverage of our updated colour-coded labour market report, released […]
    Canadian Centre for Policy Alternatives
  • Uploading the subway will not help Toronto commuters December 12, 2018
    The Ontario government is planning to upload Toronto’s subway, claiming it will allow for the rapid expansion of better public transit across the GTHA, but that’s highly doubtful. Why? Because Minister of Transportation Jeff Yurek’s emphasis on public-private partnerships and a market-driven approach suggests privatization is the cornerstone of the province’s plan. Will dismembering the […]
    Canadian Centre for Policy Alternatives
  • 2018 State of the Inner City Report: Green Light Go...Improving Transportation Equity December 7, 2018
    Getting to doctors appointments, going to school, to work, attending social engagments, picking up groceries and even going to the beach should all affordable and accessible.  Check out Ellen Smirl's reserach on transportation equity in Winnipeg in this year's State of the Inner City Report!
    Canadian Centre for Policy Alternatives
  • Inclusionary housing in a slow-growth city like Winnipeg December 3, 2018
    In Winnipeg, there is a need for more affordable housing, as 21 percent of households (64,065 households) are living in unaffordable housing--according to CMHC's definition of spending more than 30 percent of income on shelter.  This report examines to case studies in two American cities and how their experience could help shape an Inclusionary Housing […]
    Canadian Centre for Policy Alternatives
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The Progressive Economics Forum

SK Budget: Where’s the Inter-governmental Love?

A hallmark of Brad Wall’s premiership has been cosy relations with municipal governments and the two westernmost provincial governments. Since taking office, the Sask. Party has been throwing money at municipalities. It pledged not to sign the Trade, Investment and Labour Mobility Agreement with Alberta and BC, but then did so through the New West Partnership.

A couple of tax changes from the recent Saskatchewan budget are worth examining through this prism of intergovernmental relations. Much has already been written about Wall’s bizarre decision to axe the Film Employment Tax Credit and partial climb-down.

Despite the inconsistency of zeroing in on this one relatively inexpensive measure amid the province’s myriad of other tax expenditures and business subsidies, the Sask. Party had a point. The main rationale for continuing the Film Employment Tax Credit is that every other competing jurisdiction offers similar credits.

The Sask. Party may well be correct that the world would be a better place if all jurisdictions dropped their subsidies and film locations were chosen based on factors other than tax preferences. That’s hardly an argument for unilateral disarmament, but it could have been an argument for intergovernmental cooperation.

If Wall was willing to eliminate Saskatchewan’s Film Employment Tax Credit and keen to cooperate with neighbouring jurisdictions, why didn’t he first try to negotiate a simultaneous withdrawal of their film tax credits? He could at least have thrown down the gauntlet.

If the New West Partnership is to serve any sensible purpose, surely it is to prevent member provinces from using preferential policies to poach economic activity away from each other. On the contrary, my impression is that the Alberta and BC governments have already begun luring movie production out of Saskatchewan.

The other tax change is a matter of accounting. The Saskatchewan Low-Income Tax Credit, like the federal GST/HST credit, rebates about $80 million annually through the income tax system to compensate the poor for the regressive provincial sales tax (PST).

The Saskatchewan government will start subtracting this credit from reported PST revenue rather than from reported income tax revenue (see page 37 in the Budget Summary). As a result, PST is the only major source of tax revenue projected to drop in 2012-13 from 2011-12 (page 76).

Interestingly, Wall’s much-vaunted Municipal Revenue Sharing is calculated as one-fifth (one point out of five) of officially reported PST revenue. This year’s amount is based on the 2010-11 Public Accounts (page 19). Taking $80 million out of 2012-13 PST revenue implies taking $16 million (i.e. one-fifth of $80 million) out of revenue sharing, but not until 2014-15.

Political columnist Murray Mandryk suggests, “What [municipal leaders] might have missed is the move by government to deduct the low-income tax credit from the PST, which might result in municipalities foregoing $16 million from next year’s revenue-sharing pool.” The timing is such that they will take this hit shortly before the next provincial election, unless Wall orchestrates a delay as he has with the Film Employment Tax Credit.

Stay tuned for a post on the Saskatchewan budget’s corporate tax rebate for new rental accommodation . . .

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