Thank you for inviting me to speak at this very important event.

For those of you who don't know, the Canadian Taxpayers Federation is a grassroots organization of concerned citizens (like yourselves) who want to make taxes low and reasonable and government lean and accountable.

We have about 80,000 members across Canada, but we are probably strongest right here in rural Saskatchewan.

As Saskatchewan Director of the CTF, I would like to be able to take credit for that strength. But the credit largely goes to the politicians and bureaucrats who have dumped onto you one of the heaviest tax burdens in Canada.

It is in defiance of this tax burden, and in defiance of the misguided governments that have inflicted it on us, that the CTF fights for the rights of taxpayers like you.

And that is why I am here today. Because it is up to all of us to put a stop to this taxpayer abuse once and for all.



The tax burden

You carry one of the highest tax burdens in the world, and over the past few decades it has gotten worse.

The total tax bill accounts for more of the average Canadian's personal budget than shelter, food, and clothing combined.

Taxes have increased even more rapidly in Saskatchewan. Last year, the average family in this province paid about 50% of their income to various levels of government, in one way or another.

This burden is particularly hard on rural areas and farmers. Government user fees for farmers have shot up. Lease rates for Crown pasture lands have been hiked. And Crown utility bills continue to increase.

We pay the highest fuel taxes in Western Canada.

We have some of the highest income taxes in all of Canada.

And as many of you will attest, we have the highest property taxes in the country.

Because Canada has the highest property tax burden among industrialized countries, that makes Saskatchewan the property tax champion of the entire world.

However, as I like to joke, if property taxes were an Olympic event we would win the gold medal. But we would probably have to give our gold medal back because the government would probably test positive for taxation-enhancing steroids.

So what does being property tax champion mean?

For far too many farmers, it means poverty. Simple poverty.

Farmers aren't making any money in this province – they call it a farm income disaster. But while government help is dispensed with an eyedropper, taxes are siphoned with a firehose.

Our governments have failed to weave a system of effective and self-sustaining farm safety net programs that will support and defend Canadian farmers and minimize the impact on taxpayers.

But they have been very effective in weaving a system of taxes to support and defend government bureaucracy.

And as the farm income crisis has grown, so has the property tax bill for farmers.

For instance, while the cost of other farm inputs increased by 21% since 1986, property taxes have increased by 52% over the same period.

In fact, property taxes have steadily increased and are now one of the farmers' fastest rising fixed costs.

When property taxes were reassessed back in ‘96 and '97, the education tax on property in rural areas increased by $42 million, almost three times what the government promised.

School taxes in rural areas have doubled since 1985 – that's right – up 100% in just over a decade.

We may be in the middle a farm income disaster, but we are also in the middle of a farm taxation disaster.

So why have property taxes increased so much?

The demands on property tax revenue have expanded in the last few years. And many municipalities and school boards are raising taxes to make up for provincial cuts and to meet provincially-mandated cost increases, such as the salary hike for teachers.

So while we call upon municipal governments and school boards to work harder to achieve efficiencies and keep taxes down, we must not forget that the province is the real villain here.

To balance its books, and to give us token income tax relief, the provincial government has off-loaded financial obligations onto local government, and the tax burden onto local taxpayers.

It's a little political shell game called "spread the pain, but duck the blame."

And what about property taxes as a form of taxation?

Property taxes are not only too high, they are easily the most destructive, regressive, and complicated form of taxation.

They bear little relationship to the services actually received by taxpayers.

They punish people for improving their property by raising their taxes.

And they are charged to property owners without regard to income or ability to pay. If you tell the property tax collector that you can't get blood from a stone, he'll probably confiscate the stone.

And the process by which property taxes are calculated is very expensive to administer, and very confusing to taxpayers. And no wonder, with terms and concepts like market adjustment factor, provincial market index, functional obsolescence, depreciated replacement cost system, mill rates, equalization factor, and so on.

I'm not sure if these terms are from accounting or astrophysics, but it sure is confusing!

So what is the solution to the property tax problem?

Where do we go from here?

The Canadian Taxpayers Federation is calling on the government of Saskatchewan to do two things:

First, we are calling for property tax relief and a comprehensive review of the property tax system.

For example, through public hearings the government could consider replacing property taxes – which are totally insensitive to the income situation of farmers – with a form of municipal income tax or fee-for-service arrangements.

These are just a couple of ideas that might make the tax system more flexible and fairer for rural Saskatchewan.

Secondly, we are calling on the provincial government to amend the Rural Municipalities Act to give you a democratic alternative to a tax revolt in the form of citizens' initiative legislation.

This would give you the ability to petition your local government to put items to a binding popular vote.

For example, the taxpayers of this RM could petition for a referendum on property taxes, calling for tax increases to be approved by the people. If this initiative passed, all tax increases in this RM would have to be put to a public vote.

This is not such a revolutionary idea.

There is a kind of citizen initiative mechanism included in the laws that govern the cities and the north. But this democratic right is missing from the laws that govern areas of the province hit hardest by the farm income crisis.

It is totally unfair that this democratic option is denied to citizens in rural Saskatchewan. And if the province is unwilling to give you a legitimate outlet for tax protest, they must bear some responsibility if there is a tax revolt.

This government has already experienced a bit of revolt in the provincial election, when rural Saskatchewan rejected the government's policy of high taxes.

The days following the election, Saskatchewan people were excited by the prospect of a minority government.

We hoped for a government that would be less arrogant, and more responsive to the people…

A government that had promised tax relief, held to account by a strong opposition that had also promised tax relief. Unfortunately, it was not to be.

We all need to remind the Premier that the people voted strongly for reduced taxes, which was the number one issue of the campaign.

As this group has demonstrated by being here tonight, the demands of Saskatchewan taxpayers cannot be easily ignored. The election is over, and it's time for the politicians to deliver.



In conclusion…

I must make clear that the Canadian Taxpayers Federation cannot counsel you to withhold your taxes as a means of protest. However we do sympathize and understand why so many of you have been driven to the brink of a tax revolt.

It is hard to know what to do when you're in a desperate situation and the politicians seem not to listen. Many of you may feel that you have no other choices available to you.

But our politicians do have choices. They can choose tax relief. They can choose tax reform. And they can choose to give you a democratic means of expressing this tax protest.

If there is a tax revolt in this province, the responsibility will lay with governments that failed to listen to the people, and failed to act for the people.

So I urge the government to listen to you, and I urge the government to act on your behalf.

And I urge all of you here tonight to keep the faith. Thank you.

By: Richard Truscott
Posted: October 31, 1999
Topic: Saskatchewan

Contact the regional director Colin Craig for further information.

Type: Related

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