As the Premier alluded to in a video message on Monday, the first quarter financial update forecasts a surplus at the end of the year of $1.04-billion, as opposed to a $470-million deficit. Finance Minister Donna Harpauer says revenue is forecast to be $19.17-billion, up $2.02 billion or just under 11 per cent from budget, largely due to a $1.86 billion increase in non-renewable resource revenue, from higher potash and oil prices. It means being able to balance the budget, pay down debt and help Saskatchewan residents with the cost of living.
To that end, all Saskatchewan residents who are 18 as of the end of this December, and who have filed a tax return, will receive a one-time $500 Saskatchewan Affordability Tax Credit cheque this fall. It’s part of the province’s new Affordability Plan, which is detailed below. Total expenses are forecast to be $18.13-billion, which is up 2.9 per cent from budget. Harpauer says that is largely due to the $450-million needed for these cheques.
Finance Minister Donna Harpauer says the timing for the announcement of the $500 Affordability Tax Credit for all Saskatchewan adults who filed a tax return in 2021 has nothing to do with the upcoming by-election for Saskatoon Meewasin. She says, “Because there was pressure to do some earlier, we were very forthright that we would not be looking at it until we have more data, and in fact I think I pegged end of August. We didn’t force a byelection. The NDP did, and their timing was their choice”. The Saskatoon Meewasin constituency has been vacant since July 1st, after former leader of the NDP, Ryan Meili, stepped down. No date has been set yet, but it must be held within six months or by January 1st. The NDP has nominated small business owner and former teacher, Nathaniel Teed. The Sask Party’s candidate is businessman Kim Groff, who has run previously for the party, and provincial Liberal leader Jeff Walters.
Affordability Plan
Point one of the four-point plan is the Affordability Tax Credit payment of $500 this fall for all residents 18 and older as of December 31st, who have filed a 2021 tax return. The deadline for those who haven’t filed your taxes, if you want to get in on this money, is to file by the end of October. Harpauer notes that the $500 won’t be taxed either provincially or federally. She adds that those who haven’t filed their taxes are also missing out on the GST rebate, the carbon tax rebate and possibly the low income tax rebate, and if they don’t file, they are missing out on about $1,000 a year. If needed, Harpauer says community-based organizations and Social Services can help residents to file their taxes.
Point two is to not add fitness and gym membership and some other recreational activities to the planned October expansion of the PST. They will continue to be exempt.
Point three is to extend the small business tax rate reduction at zero per cent retroactive to July 1st, and delay the restoration of the rate to two per cent to July 1st of 2024. Harpauer says this will help small businesses as they recover from the pandemic, while also facing new challenges like inflationary pressures, interest rate hikes and supply chain issues.
Point four is getting rid of up to $1-billion in operating debt. As listed above, the debt is forecast to be $1.72-billion lower at fiscal year-end than was projected at budget, which Harpauer says means they can retire up to $1-billion in debt, and the province no longer needs to borrow for operations because of the improved financial position. It’s estimated to lower interest costs by $49-million.
