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  • Community Economic Development in Manitoba - a new film January 16, 2018
    Cinameteque, Jan 23.  7:00 pm - Free event Film Trailer CCEDNET-MB, CCPA-MB, The Manitoba Research Alliance and Rebel Sky Media presents: The Inclusive Economy:  Stories of Community Economic Development in Manitoba
    Canadian Centre for Policy Alternatives
  • Winnipeg's State of the Inner City 2018 January 3, 2018
    Winnipeg's community-based organizations are standing on shakey ground and confused about how to proceed with current provincial governement measurements.  Read the 2018 State of the Inner City Report.
    Canadian Centre for Policy Alternatives
  • Our Schools/Our Selves: Winter 2018 is online now! December 18, 2017
    For the first time, this winter we are making Our Schools/Our Selves available in its entirety online. This issue of Our Schools/Our Selves focuses on a number of key issues that education workers, parents, students, and public education advocates are confronting in schools and communities, and offers on-the-ground commentary and analysis of what needs to […]
    Canadian Centre for Policy Alternatives
  • Charting a path to $15/hour for all BC workers November 22, 2017
    In our submission to the BC Fair Wages Commission, the CCPA-BC highlighted the urgency for British Columbia to adopt a $15 minimum wage by March 2019. Read the submission. BC’s current minimum wage is a poverty-level wage. Low-wage workers need a significant boost to their income and they have been waiting a long time. Over 400,000 […]
    Canadian Centre for Policy Alternatives
  • CCPA-BC joins community, First Nation, environmental groups in call for public inquiry into fracking November 5, 2017
    Today the CCPA's BC Office joined with 16 other community, First Nation and environmental organizations to call for a full public inquiry into fracking in Britsh Columbia. The call on the new BC government is to broaden a promise first made by the NDP during the lead-up to the spring provincial election, and comes on […]
    Canadian Centre for Policy Alternatives
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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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