The Manitoba NDP want to tax high-income earners more to give some back to low and middle-income earners.
In a fiscal update that essentially acts as an election promise, Premier Greg Selinger wants to create a new tax bracket for those with a taxable income of more than $170,000.
Their tax rate would increase from 17.4 per cent to 20.9 per cent starting in 2017.
That means those with a taxable income of $200,000 would pay $1,050 more in 2017. Someone earning $500,000 would pay $11,550 more.
The change would affect about two per cent of Manitoba taxpayers. No other tax brackets or rates are changing.
Premier Greg Selinger says that would bring in about $50 million that would then be given back to hundreds of thousands of lower and middle class families in the form of existing tax credits.
“It’s just our way of showing that they need to be rewarded for the hard work they’re doing to keep their families together and to contribute to our economic growth,” he said.
The family tax benefit and affordability tax credit amounts would each increase by 20 per cent. That means a family four with a $60,000 income would save $260.
These changes could not come into effect until after a budget is tabled, which will be after the provincial election on April 19. If another party wins, they could never come to fruition.
PC Leader Brian Pallister says he doesn’t think low and middle-income earners will fall for the promise after the PST hike.
“He’s promising to do what, put a nickel in pocket of those he took $5,000 from? I don’t think Manitobans are going to get fooled again,” he said.
Liberal Leader Rana Bokhari says she isn’t in support of any tax bracket changes right now.
“I just think Manitobans are taxed enough. That’s not what they’re looking for. They’re looking for a government to take a look at their own pockets and see where they are mismanaging our financial situation. Four years from now, if we feel that it’s a different story, then we can revisit this,” she said.
2015/2016 Deficit Much Larger Than Forecast
The fiscal update also projects a much higher deficit than was originally forecast in the 2015/2016 budget.
Three-quarters of the way through the fiscal year, the government is forecasting a $733-million deficit – $351-million more than initially projected.
Expenditures are forecast to be more than $160-million over budget – child welfare and health care costs are up more than $100-million combined.
The Premier says the downturn in the Canadian economy has also played a role.
The projected deficit for 2016/2017 is $619-million dollars.
He hopes to balance the budget the same year the federal government wants to – 2019/2020.
Tories Try To Delay Fiscal Update
The tabling of the NDP “mini budget” was delayed almost an hour in the legislature because of stall tactics used by the opposition Tories.
Pallister says it is a cop out and wants the government to put a true budget out before the election.
“He’s had a full year to prepare a budget to tell Manitobans what the price is for all his pre-election promises, so he should table a budget today,” he said.
Selinger said they traditionally table their budget after the federal government does.
NDP House Leader Dave Chomiak was able to table the update in the chamber despite the stall tactics.
Manitobans go to the polls in April. The campaign could officially kick off as early as next Tuesday.
(With files from Keith McCullough.)