Taxpayers Federation presents 2007/08 budget recommendations

• Returning Prosperity to Manitoba

WINNIPEG: The Canadian Taxpayers Federation's Manitoba Director Adrienne Batra will present the CTF's findings and recommendations for the 2007/08 Manitoba Budget.

The theme of this year's pre-budget submission is Returning Prosperity to Manitoba. "Over the past few years, the CTF has presented the results of supporter surveys that clearly outline a concern about Manitoba's high personal and business taxes and their impact on the province's economic fortunes and competitiveness," stated Provincial Director Adrienne Batra. "The CTF recommends the government's fiscal strategy must be built on the pillars of debt reduction and tax relief."

The CTF maintains that Manitoba's tax system be straight forward and understandable. Further, the tax system should promote economic prosperity for all Manitobans and not discourage the incentive to work, save or invest. "In the context of fostering economic growth, opting to tax less from a larger number of taxpayers is always a good policy," added Batra. "The CTF commends the provincial government for the minor tax relief brought forward in previous budgets, but more needs to be done to put more money back into the pockets of Manitobans and indexing tax brackets."

Taxpayers have long advocated for a reduction in Manitoba's provincial debt. Last year Manitoba's debt (including crowns) totaled $16.7 billion. Under the existing balanced budget law, $110 million was paid down last year and debt servicing costs increased from the previous two years to $282 million. "There is no greater loss to Manitoba's taxpayers than $282 million in public debt servicing costs. Every day Manitoba's debt costs taxpayers $772,602 or $32,191 an hour. These do not add to services for Manitobans and are the result of irresponsible spending patterns which exceeded revenues," said Batra. "The current government should be working hard to keep Manitoba's budget balanced as a key first step, but real debt reduction will be essential for finding medium and long-term savings above and beyond any exercise in reducing and reallocating spending."

The CTF proposes the adoption of a mandated debt retirement payment based on 2.5 percent of own source revenues (total revenues less any federal transfers). "Taking an aggressive approach to the debt today will ease growing spending pressures from the baby boom generation," concluded Batra.


The CTF's 15 Recommendations for the 2007/08 Budget are:

1. Reduce the size and costs of the public service. Re-examine salaries paid to the public service, contractual relationships, as well as the total number of employees currently on the government payroll. Public sector wages must be reviewed in all sectors.
   
   
2. Eliminate business subsidy programs - $10 million in annual savings.
   
   
3. In conjunction with the next provincial election, hold a referendum on the question of opening up Manitoba Public Insurance to competition.
   
   
4. Privatize Manitoba Liquor Control Commission and use proceeds of the sale to pay down debt.
   
   
5. For the review of the 11 regional health authorities the CTF recommends annual audits, salary review, long-term plan for all health authorities, consideration of P3s and offering patients choice for health care delivery.
   
   
6. A full value-for-money audit of all school boards in Manitoba including a review of salaries paid to administrators and trustees.
   
   
7. Set provincial income tax rates as follows - first rate from 10.9 percent to 10 percent, middle rate from 13 percent to 12.5 percent and third rate from 17.4 percent to 17.0 percent.
   
   
8. Raise the Basic Personal Exemption in the 2007 tax year to $9,000.
   
   
9. Fully index Manitoba's tax brackets, BPE and spousal exemption to the rate of inflation and end bracket creep.
   
   
10. Eliminate the provincial payroll tax.
    
    
11. For this fiscal year, the provincial government should freeze school taxes.
    
    
12. Establish a long-term solution to increase the provincial share of education funding to 100 percent.
    
    
13. Expand the scope of the Balanced Budget, Taxpayers Protection and Debt Retirement Act to school boards and municipalities.
    
    
14. The CTF recommends the adoption of a mandated debt retirement payment based on 2.5 percent of own source revenues (total revenues less any federal transfers).
    
    
15. The provincial government rejects recommendations to amend the BBL to implement balancing the books on a four-year cycle and elimination of mandatory debt repayment.

A full copy of the report, "Returning Prosperity to Manitoba" is available at www.taxpayer.com.