It’s been a great week for Alberta taxpayers..Thanks to the resource sector, the province posted a $13.2-billion surplus and the government had a choice on how to spend it..In Alberta, we're on the resource roller-coaster and oil prices are at the top of the ride, so the government could have gone on a spending bender at the carnival midway. Big stuffed animals and cotton candy for all?.Nope. Instead of blowing the cash on pay hikes for bureaucrats or a hair-brained global conference, it’s doing smart things. Premier Jason Kenney announced the government is scrapping the bracket creep income tax hikes that costs you hundreds of dollars. And, he’s putting cash down on the provincial debt. And he’s saving for a rainy day..Let the taxpayer trumpets sound. Kenney says the average taxpayer will save about $300 by getting rid of bracket creep..Bracket creep happens when governments don’t move tax brackets with inflation. Inflation bumps taxpayers’ pay into higher tax brackets even though they can’t actually afford to buy more. Bracket creep also erodes the tax-free portion of taxpayers’ income. By making it retroactive to this fiscal year, people will save a hundreds of dollars..There’s more good news. By putting down more than $13 billion on the provincial debt, the government is helping to reduce the interest payments on the debt by about $42 million dollars. That’s money that won’t be going to bond holders on Bay Street in Toronto. Instead, it can be saved, spent wisely, or given back to Albertans in tax relief..But wait, there’s more good news. On top of giving Albertans much-needed income tax relief and paying down a chunk of provincial debt, the government is putting $1.7 billion into the Heritage Savings Trust Fund, bringing the total up to about $19 billion..That leads us to the task ahead. We should have more money in our province’s savings account..Alberta is rich in natural resources and it is full of hardworking people. That means when times are good in the energy sector, the carnival comes to town and the government forgets how to be prudent. It also means that when things go bust and people are used to the overspending, the special interest groups start screaming for tax hikes so they can keep on spending at boom-time levels..If we had big fat savings account in Alberta, we would not need to have fiscal panic attacks when the price of oil goes down, or when Ottawa puts a new choke hold on our economy..We need a firm and sensible debt repayment and savings plan that insulates us from energy fluctuations and Ottawa’s whims while also enshrining savings into law for future governments. Albertans remember how good it felt, when premier Ralph Klein held up the debt “paid in full” sign. It’s possible to get there again..Now, the Alberta government should strengthen the Heritage Fund. It needs to function in a similar manner to Norway’s Sovereign Wealth Fund that banks that country's oil revenue. Norwegians currently have more than $1 trillion USD saved in their rainy decade fund. Work done by the Fraser Institute shows if Alberta had followed Norway’s example, we would by now have about $170 billion in our own Heritage Fund..So, it is a good news week for Alberta’s taxpayers. The government is using the current surplus wisely, instead of blowing it. We have tax relief, with the scrapping of income tax bracket creep. And the majority of United Conservative candidates signed the Canadian Taxpayers Federation Pledge that if they become premier, they will never impose a Provincial Sales Tax or raise taxes on Albertans..This week is a win for taxpayers..Kris Sims is the Alberta Director of the Canadian Taxpayers.
It’s been a great week for Alberta taxpayers..Thanks to the resource sector, the province posted a $13.2-billion surplus and the government had a choice on how to spend it..In Alberta, we're on the resource roller-coaster and oil prices are at the top of the ride, so the government could have gone on a spending bender at the carnival midway. Big stuffed animals and cotton candy for all?.Nope. Instead of blowing the cash on pay hikes for bureaucrats or a hair-brained global conference, it’s doing smart things. Premier Jason Kenney announced the government is scrapping the bracket creep income tax hikes that costs you hundreds of dollars. And, he’s putting cash down on the provincial debt. And he’s saving for a rainy day..Let the taxpayer trumpets sound. Kenney says the average taxpayer will save about $300 by getting rid of bracket creep..Bracket creep happens when governments don’t move tax brackets with inflation. Inflation bumps taxpayers’ pay into higher tax brackets even though they can’t actually afford to buy more. Bracket creep also erodes the tax-free portion of taxpayers’ income. By making it retroactive to this fiscal year, people will save a hundreds of dollars..There’s more good news. By putting down more than $13 billion on the provincial debt, the government is helping to reduce the interest payments on the debt by about $42 million dollars. That’s money that won’t be going to bond holders on Bay Street in Toronto. Instead, it can be saved, spent wisely, or given back to Albertans in tax relief..But wait, there’s more good news. On top of giving Albertans much-needed income tax relief and paying down a chunk of provincial debt, the government is putting $1.7 billion into the Heritage Savings Trust Fund, bringing the total up to about $19 billion..That leads us to the task ahead. We should have more money in our province’s savings account..Alberta is rich in natural resources and it is full of hardworking people. That means when times are good in the energy sector, the carnival comes to town and the government forgets how to be prudent. It also means that when things go bust and people are used to the overspending, the special interest groups start screaming for tax hikes so they can keep on spending at boom-time levels..If we had big fat savings account in Alberta, we would not need to have fiscal panic attacks when the price of oil goes down, or when Ottawa puts a new choke hold on our economy..We need a firm and sensible debt repayment and savings plan that insulates us from energy fluctuations and Ottawa’s whims while also enshrining savings into law for future governments. Albertans remember how good it felt, when premier Ralph Klein held up the debt “paid in full” sign. It’s possible to get there again..Now, the Alberta government should strengthen the Heritage Fund. It needs to function in a similar manner to Norway’s Sovereign Wealth Fund that banks that country's oil revenue. Norwegians currently have more than $1 trillion USD saved in their rainy decade fund. Work done by the Fraser Institute shows if Alberta had followed Norway’s example, we would by now have about $170 billion in our own Heritage Fund..So, it is a good news week for Alberta’s taxpayers. The government is using the current surplus wisely, instead of blowing it. We have tax relief, with the scrapping of income tax bracket creep. And the majority of United Conservative candidates signed the Canadian Taxpayers Federation Pledge that if they become premier, they will never impose a Provincial Sales Tax or raise taxes on Albertans..This week is a win for taxpayers..Kris Sims is the Alberta Director of the Canadian Taxpayers.
