• Manitoba income tax rates are now the 3rd highest in the country.
  
• 2002 Manitoba personal income tax savings are miniscule.
  
• Provincial bracket creep continues to collect income taxes by stealth.
  
• Average employee to pay $157 more in federal payroll taxes in 2002; largest hike in 11 years.
  
• New air travellers' security charge is backdoor taxation.

WINNIPEG: Manitobans looking forward to a fresh start in 2002 will be disappointed by the provincial government's lack luster approach to inter-provincial tax competitiveness. Come January 1, 2002, Manitoba will charge the third highest personal income taxes in the country.

"While Rome (Manitoba) burns, the other provinces race to offer competitive tax structures and in the process poach our best and brightest talent," said Victor Vrsnik, CTF provincial director. "A Recent Statistics Canada report that 2,200 Manitobans quit the province between July and October for greener pastures cannot be explained in isolation of Manitoba's high taxes and low salary range."

Not only is Manitoba falling behind in its tax rates, but it is one of the last provinces to refuse to index its tax brackets to inflation. "The benefit of indexation," said Vrsnik, " is that it eases the tax bite by moving more of your income into the lower tax brackets. Manitoba's miniscule tax savings (outlined in the chart below) this year over last are sure to be washed out by the impact of bracket creep."

Federal tax changes for 2002 are no better.

"Manitoba taxpayers better stock up on the Tylenol and Ibuprofen because the New Year will usher in a whopping federal tax hangover," said Vrsnik. "A new $12 federal flyer tax combined with an extra $157 more in payroll taxes for workers will take a bite out of Paul Martin's much lauded income tax cuts."

While EI taxes are dropping by a nickel or a modest 2.2%, CPP premiums will skyrocket by 11.8% or 40 cents for each $100 of earnings. "Payroll taxes are profit insensitive job killers. It's a bizarre way to bring in the New Year."