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$2.7 billion, but not one penny for taxpayers

Author: John Carpay 2003/02/27
The Alberta government's revenues, also known as our tax dollars, are $2.7 billion higher than what was expected when Budget 2002-03 was introduced last year. When Premier Klein hit us with a $641 million tax increase in 2002, he planned to spend $18.5 billion on government programs, and collect $19.9 billion in taxes. But the picture has changed. Income from the Heritage Fund is less than expected, but revenues from oil, gas, personal income tax, corporate income tax, and other sources are higher than expected. The bottom line: the government now has an extra $2.7 billion that it wasn't counting on 12 months ago.

As always, Opposition MLAs are using these revised estimates to challenge the government's integrity. But it's impossible to get inside another person's mind or heart to measure sincerity. Besides, it's better to budget spending on lower estimates ("conservative" estimates - but no pun intended) than on higher ones. As usual, neither the Liberals nor the NDP called for a tax cut to return any of this money to those who earned it in the first place.

You would think that some of that $2.7 billion would come back to us, the Albertans who pay for the government's education, health care, infrastructure and social programs. Especially when you consider that Alberta spends more on programs, per person, than any other province in Canada. Consider, too, that Alberta's spending is now 58% higher than it was six years ago - compared to only 12% population growth.

So what is the government doing with this extra $2.7 billion in tax dollars One billion is going towards debt repayment and towards kick-starting the new fiscal stability fund. Of the remaining $1.7 billion, 100% of it is going to new, extra spending, and not one penny is coming back to taxpayers.

What would our lives look like if this $1.7 billion was left in our pockets rather than being spent by politicians and bureaucrats Alberta's personal income tax rate could be lowered from 10% down to 6.5%. Or the provincial school property tax could be eliminated entirely, plus an income tax reduction from 10% to 9%. Or the government could end its reliance on VLT revenues, plus cut income tax from 10% to 9%. Or the government could eliminate the $1,056-per-family health care premium tax, plus cut income tax from 10% to 8%.

Wonderful options Yes, but MLAs would rather spend our money trying to solve one or more of the many "crises" that social workers, union leaders and special interest groups complain about every day. MLAs of all three parties assume that problems are actually solved by government, or that problems are solved more quickly and more effectively by government. Most politicians forget that the government's money is money that was forcibly taken away from workers, families, communities and charities, who no longer have that money available to meet their own needs and to solve their own problems.

A little bit of spending control - just a touch of restraint - and Premier Klein can easily reverse last year's $641 million tax increase. Will he do so We'll find out on April 8, when Budget 2003-04 is presented in the Legislature. Between now and then, concerned taxpayers should contact their MLAs and demand a tax cut.

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Franco Terrazzano
Federal Director at
Canadian Taxpayers
Federation

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