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Potential premiers must reconsider PST on insurance

September 19, 2017
Potential premiers must reconsider PST on insurance

It takes a special skill to drive onto a farmyard, lean on a tailgate and make a pitch. Candidates to be Saskatchewan’s next premier will be putting that skill to test and to be successful they’ll need a good answer to a tough question: what will they do about the province’s decision to charge PST on insurance premiums?

The Saskatchewan Party government started charging PST on insurance premiums this summer. It’s costing many families hundreds of dollars per year. It’s costing many businesses thousands. It’s costing some farmers tens of thousands of dollars.

Here’s some math for those doubting the impact. The average Saskatchewan farm is 1,668 acres, according to Statistics Canada. Charging PST on insurance will cost farmers $2 per acre, according to the Agricultural Producers Association of Saskatchewan. That means charging the PST will cost the average farmer $3,336 per year. (To put that in context, internal federal documents estimate a carbon tax will cost Western Canadian farmers an average of $3,705.) For bigger farms, the insurance bill increase will be five digits.

Here’s some more math for those confused by the government’s spin about shifting from income taxes to consumption taxes. Reductions to business and income taxes will save taxpayers $50 million and $8 million respectively. PST charges on insurance premiums will cost taxpayers more than $200 million. It’s not a tax shift, it’s a tax hike and it’s a big one.

Candidates hoping to take over as premier are figuring out the PST-on-insurance pitch won’t sell.

“We must ensure that we support the people of Saskatchewan who wisely plan for their futures; our policies cannot hinder that important process,” wrote Sask. Party leadership candidate Ken Cheveldayoff in a Sept. 7 release. “I propose that we revisit the sale tax base as it relates to insurance, by undertaking a thorough review.”

A “thorough review” is still going to be a tough pitch for farmers staring down an insurance bill that’s going up by thousands of dollars, but it’s a start.

Sask. Party MLA Jeremy Harrison, who dropped out of the leadership race to join Scott Moe’s campaign, made a much clearer pitch to simply “remove the PST from all insurance products.”

While Sask. Party candidates are re-examining their position, the NDP is taking a firm stand.

“It’s very alarming,” said interim-NDP leader Nicole Sarauer when asked the province’s decision to start charging PST on insurance. “The government needs to take a step back and decide not to impose the PST [on insurance].”

The NDP points to the unfairness of putting the PST on premiums people have to pay to drive to a car or own a home, and it’s using the issue as an opening to connect with small business and even agriculture.

For any Sask. Party leadership candidate to defend PST charges on insurance while other candidates promise to repeal it will be, well, awkward, especially when talking to that party’s traditional core of small business owners and farmers. But it’s a good bet ice-fishing buck naked would be less awkward for the next Sask. Party leader than taking the pro-tax side of a debate against the NDP.

In reality, all of the political maneuvering is secondary. Campaigns are about the voters. And their views are clear.

More than 78 per cent of Saskatchewanians oppose PST charges on insurance, according to an Insightrix poll. More than half are strongly opposed. More than a third say they’ll have to reduce coverage or cancel policies due to the higher costs. No political pitch should make it harder for people to protect their homes, businesses, farms and families.

Any politician hoping to represent the people of this province has to commit to taking the PST off insurance.


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