The Canadian Taxpayers Federation is calling on the government of Prince Edward Island to control spending as the budget includes an operational deficit of $85 million.  

“It’s clear that the King government did very little to find savings and balance the books,” said CTF Interim Atlantic Director Jay Goldberg. “Spending in P.E.I. is out of control and deficits are adding up. Islanders don’t want to be on the hook for tens of millions of dollars in debt interest that could be used for tax relief or important programs.”

The deficit for 2024-25 is projected to be $85 million, which is the same size as the government’s budget deficit for 2023-24. P.E.I.’s net debt will reach $3.1 billion by the end of the 2024-25 fiscal year and debt interest payments will cost Islanders $167 million this year.

Finance Minister Jill Burridge announced that most tax brackets will once again be adjusted to keep pace with inflation in 2025, a process the King government began in last year’s budget. The basic personal amount will be increased to $14,250.

“It’s great to see the King government is again adjusting income tax brackets,” said Goldberg. “Every taxpayer earning less than $140,000 will avoid being hit with bracket creep next year.”

Bracket creep happens when governments don’t move tax brackets with inflation and inflation can automatically bump taxpayers into a higher tax bracket even though they can’t actually afford to buy more. The King government’s changes to the income tax system will ensure that most Islanders aren’t hit with bracket creep in 2025.