Welcome to Alberta. If proposed tax relief from the 1999 budget actually happens over the next couple of years (it's contingent on reaching certain revenue targets), Albertans could face a combined federal-provincial top marginal rate in 2002 of 41.5 percent. That would be 11 percentage points below BC and nine percentage points below Saskatchewan. If BC thinks its losing people to Alberta now - wait three years (and hope someone is left to turn out the lights.)

But before examining the promised tax relief, let's look at some other Alberta Budget 1999 tidbits. On the negative side, there was no provincially initiated tax relief in 1999. However, Albertans will pay $55 million less in provincial tax in 1999 because of Ottawa's decision to hike the basic personal exemption and spousal exemption. Since provincial taxes are linked to federal tax payable, Albertans will see some provincial tax relief thanks to Paul Martin.

On the spending side, it appears the government is weak-kneed on restraining the growth of spending in health and education. Health spending will jump by 8.7 percent in 1999 and by over 21 percent by March 2002 when compared with today. Education spending has similar spending spikes in the pike. Despite such increases, the usual suspects carped at the government for not spending enough. When those politicians would like a date with reality, they should ask themselves why Japan - which spends much less than do Canadian governments on health and education as a percentage of Gross Domestic Product - possesses higher literacy rates and better health. Hmmm. Perhaps more taxpayer money in advanced industrial countries that already spend a lot does not lead to better-educated and healthier citizens. Maybe the problem is in how such money is spent - or because of factors that have nothing to do with money.

The additional spending spikes announced in the provincial budget are doubly worrying because the province has consistently overshot its past program spending targets. This time last year, the province forecast program spending for the 1998 budget year at $13.9 billion. When all the bills are paid it will be closer to $14.5 billion. Program spending for 1999 is forecast to be $15.1 billion. Will that target stick Place your bets now gentlemen.

On the positive side however, the Tories' plan to eliminate the two provincial surtaxes - introduced 12 years ago to fight a deficit that has now been gone for five years - is welcome even if late. If all goes according to plan, those two taxes worth $400 million in 1999 will be completely gone in three years time. (Reality check: Albertans would pay $800 million less in provincial tax in 1999 if we were taxed at 1983 Lougheed-era income tax rates.)

Also welcome is the province's plan to de-link Alberta's taxes from Ottawa. Right now, provincial tax is calculated as a percentage of federal tax. In 2002, Albertans will instead calculate provincial tax based on income. Rather than borrowing Ottawa's meager $7,131 exemption, Albertans will see their first $11,620 exempt from provincial tax, ditto for the spousal exemption.

Of course, the biggest news out of the budget was that income over $11,620 will be subject to a single rate of tax of 11 percent. The more generous exemptions, an 11 percent single rate, combined with $600 million in tax relief, will ensure that every Albertan - poor, middle-income or rich - will see a break. Naturally, some politicians and pundits don't like that idea. They just hate it when governments willingly take in less money. And that's precisely why taxpayers should like this budget. If the province follows through with its tax relief plans, taxpayers will be treated as one entity, instead of divided up and conquered by different income levels to be plundered by politicians when it's politically convenient.