Sales tax won’t fly, says finance minister
Campbell says Albertans tell him they’re against a consumption levy
Finance Minister Robin Campbell says the Alberta government could essentially solve its revenue problem by introducing a provincial sales tax, but there is no public appetite for it.
However, a sales tax could be looked at in the future if Albertans are interested, he said Monday.
Speaking at the traditional Calgary Chamber of Commerce luncheon following the release of the provincial budget, Campbell said Albertans want the province to get its spending under control before contemplating a PST.
“The easy fix would have been to put a consumption tax on,” he said in response to a question from chamber staff.
“We could probably resolve our deficit with a five per cent consumption tax, but that wouldn’t have curtailed government spending.”
“While people will come up and say they want a consumption tax, I can tell you that all the calls and emails in my office, 80 per cent of Albertans said no. They still see no sales tax as an Alberta advantage, so I don’t think we’re quite there yet to where we need to be to talk about that.”
It is estimated that each point on a provincial sales tax would raise over $ 1 billion annually.
The budget introduced by the Progressive Conservative government posted a $ 5- billion deficit.
Grappling with plunging oil prices, the government ditched the province’s flat tax on income with a new progressive health care levy and added new brackets for those earning over $ 100,000.
Jim Prentice’s government also hiked a host of other user fees and taxes, including liquor, tobacco and fuel taxes, while holding the line on spending.
However, the Tories resisted increasing corporate taxes or introducing a sales tax.
The NDP and Liberals have slammed the government for leaving the corporate tax rate untouched.
Newly elected Wildrose Leader Brian Jean accused the PC government on the weekend of planning to bring in a PST after the spring election that Prentice has signalled is coming.
“This is what they talk about, they need to bring in a PST,” he said in his victory speech.
Campbell told reporters it is up to Albertans whether they want a sales tax.
While there has been increasing talk about the idea, especially among economists, he said he’s not sure it’s the best option.
“We need to look at everything as we move forward,” he said.
“Again, I’d want to make sure we have a low- tax regime. It’s important to Albertans that we do. It’s important to us that we attract investment. So I’m not about to do anything that would curtail investment or cause Albertans to lose their jobs.”
Justin Smith of the Calgary Chamber of Commerce said the organization had hoped to see the government have “a more robust dialogue with Albertans” on new revenue streams, including a PST.
“Economists would argue it’s less predisposed to economic boom and-bust cycles,” he said.
I’d want to make sure we have a low- tax regime. It’s important to Albertans that we do. It’s important … we attract investment.