Politician's dream, taxpayer's nightmare
Author:
John Carpay
2005/04/13
Alberta's 2005-06 Budget contains $44 in new spending for every $1 in tax cuts. That 44:1 ratio is what makes this budget a politician's dream but a taxpayer's nightmare. Premier Klein used a fire-hose for spending increases but an eye-dropper for tax cuts, leaving in place the tax increases which he imposed on us in 2002.
Our provincial Tories are spending on a scale that would make a federal Liberal blush. Spending on government programs is up by 100% in nine years, from $12.7 billion in 1996 to $25.5 billion today. During those same nine years, Alberta's population grew only 17% and cumulative inflation was 26% - a far cry from the 100% increase in spending.
Yesterday's budget contained only two tiny tax cuts. Alberta's hotel room tax goes from 5% to 4% and is now called a "tourism levy." Provincial property tax rates go down by 5% to absorb some of the property tax increases brought on by rising market values. Provincial tax cuts total $73 million, which is about $23 per Albertan, or $92 for a family of four, for the whole year.
This $73 million tax cut is a small fraction - one forty-fourth to be precise - of the $3.2 billion spending increase.
In spite of receiving more money - per person - than any other government in Canada, and in spite of spending more on government programs - per person - than other provinces, Alberta's Tories continue gouging families for an extra $1,056 in "health care premiums," all of which goes into general revenues. A family with children, getting by on $35,000 per year, must pay the full $1,056 in addition to provincial income tax, fuel tax, property tax, etc.
Premier Klein could wipe out the health care premium tax tomorrow, and still have enough money to out-spend all other premiers.
The absence of a real tax cut in yesterday's budget cannot be explained by a lack of revenues. Rather, it's a refusal by politicians to listen to what Albertans said clearly in province-wide surveys in 1998 and again in 2000. In the 2000 "It's your money" survey, Albertans were asked "What would you like to do with your interest savings money when the debt is gone " Tax reductions were ranked as "highly important" by 73% of Albertans, with only 44% giving that rank to program spending. Albertans also told Premier Klein that when the government receives extra money from resources, one-time tax rebates are far more important than one-time spending. But our Tories, egged on by the Liberals and NDP, continue to read these survey results upside down.
Klein and most of his would-be successors are addicted to spending other people's money. That's why yesterday's budget hiked spending by $44 for every $1 in tax reductions. But like most addicts, they don't see their addiction as a problem. Rather, they see themselves as saviours, or as Santa Claus, keen to "help" Albertans by robbing Peter to pay Paul. Elitism blinds them to the possibility that Albertans actually want to keep more of their own earnings. In other provinces, these people would be called liberals or socialists. Here in Alberta, we call them Tories.