CTF Meets Finance Minister to Present 2004/05 Pre-Budget Recommendations

CTF Prebudget submission (175 KB)

WINNIPEG: The Canadian Taxpayers Federation will meet with Finance Minister Greg Selinger this morning to present the CTF's findings and recommendations for the 2004/05 Manitoba Budget.

The theme of this year's pre-budget submission is "controlled spending and smaller government." There is little question that Manitoba's economy has been underperforming for many years. Though not the worst economy in the country, Manitoba ranks 8th among the provinces, when measuring average economic growth between 1993 and projected 2005. In that same time frame, the national average for Gross Domestic Product (GDP) growth was 5.21 per cent, while Manitoba showed a meager 4.48 per cent annual growth rate. The CTF is once again pressing the provincial government to follow the lead of most other provinces and announce the elimination of bracket creep by fully indexing tax brackets and credits to inflation.

"There is too much waste in our provincial government and it is time for the Premier and Minister of Finance to find efficiencies in the system," said Adrienne Batra, CTF provincial director. "Taxpayers are voting with their feet, leaving the province resulting in consistent net out migration from Manitoba. We can no longer turn a blind eye to our province's dismal economic performance," added Batra.

Driven by the results last year's CTF membership survey results, the pre-budget submission, available at www.taxpayer.com, finds that low confidence in provincial tax rates to spur business development has inspired members to press for income tax relief, consolidate government departments and put a lid on run-away spending.

The CTF will press for property tax reform by calling for a comprehensive review of the school tax system to explore alternative education funding mechanisms and for the province to immediately adopt the Summary Budget process as recommended by the Auditor General. "At a time when school taxes on property are set to increase yet again, it is imperative the province take a leading role to mitigate the burden property taxpayers must shoulder - a comprehensive review our school system is needed and should be a priority for the next budget," concluded Batra.


CTF Pre-budget 2003/04 recommendations:

Spending:

• Freeze departmental spending. Increases required in priority areas such as health care spending should be funded by a redirection of existing budget envelopes.
• Phase out business subsidy programs, $11 million, and cut departmental funding by an equal amount.
• Do not raid the reserves of publicly owned utilities to increase overall spending and achieve a balanced budget.
• Introduce competition, and privatization to government departments and agencies such as Manitoba Liquor Control Commission and Manitoba Public Insurance.

Income Tax Relief:

• Eliminate bracket creep and fully index tax brackets and credits to inflation.
• Set 2004 individual income tax rates that surpass those in Saskatchewan. The first rate should fall from 10.9% to 10%, the middle rate should fall to 12.5% and the top rate should fall to 14.5%.
• Set the 2004 basic personal exemption and spousal deduction to at least Saskatchewan's level of $8,000.

Property Taxes:

• Continue to phase out the provincial education support levy.
• Eliminate or phase out school division taxes that are levied on farmland.
• Conduct a comprehensive review of the school tax system to explore alternative education funding mechanisms similar to Saskatchewan's Commission on financing K-12 education.
• Do not grant municipalities new taxing powers such as a hotel tax, a gas tax levy, a sales tax or an income tax.

Balanced Budget:

• A 2004/2005 balanced budget should account for future federal transfer reductions and interest rate increases.
• Do not introduce amendments that would in any way weaken or water down the impact and intent of the Balanced Budget, Taxpayer Protection and Debt Retirement Act.
• The Government of Manitoba immediately adopt the Summary Budget process as recommended by the Auditor General.