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Time to elect for a tax cut

Author: Scott Hennig 2008/01/11
Premier Ed Stelmach's recent musing on whether or not to eliminate Alberta's regressive health-care premium is significant for many reasons.

For starters, it's the first time the premier has publicly said eliminating the $1,056 per year per family tax is being considered. Although, to be fair, he did tell the Canadian Taxpayers Federation in a survey during his leadership bid he doesn't like health-care premiums. (He did stop short of committing to eliminate them).

Second, it makes clear there will be no budget before the election.

Stelmach's musing was in relation to the PC Party's upcoming election platform, not the provincial budget, set for release Feb. 14.

If he was going to release his fiscal blue-print before calling an election, he would have suggested the budget may contain this tax cut, but he didn't.

With the premier out of the province for much of January, expect the election call to follow the throne speech on Feb. 4, as was done by former premier Ralph Klein in 2001.

Third, and important, it affirms Stelmach, much like Klein before him, is a populist rather than an ideologue.

Klein used to say he liked to find out where the parade was headed and then get to the front of it. Stelmach is simply doing the same.

For the cause of eliminating our health-care premium tax, this could work in taxpayers' favour.

During the past few years, support for eliminating the health-care premium has grown significantly.

For the longest time, only the Canadian Taxpayers Federation and a handful of politicians advocated the taxes' demise. Now every Opposition party in the legislature (Liberal, NDP, and Alberta Alliance) claim they'd kill the unpopular tax if they formed government.

Further, support within the PC caucus has grown.

During the PC leadership race in the fall of 2006, five of the eight candidates indicated they would eliminate the tax if elected, including current Finance Minister Lyle Oberg; Health Minister Dave Hancock and Sustainable Resource Development Minister Ted Morton.

Support outside the legislature is also strong.

In fact, in a November 2006 Ipsos-Reid poll of Albertans, 80% supported eliminating the health-care premium.

With support growing both inside and outside the legislature to eliminate this so-called health-care premium ('so-called' because the money raised doesn't go to health care and it's not a true insurance premium), Stelmach's musing shows he's reading the writing on the wall.

This populist bent means the upcoming provincial election provides the best chance taxpayers have had in years to get this unfair tax eliminated. Stelmach will have little choice but to scrap this tax if Albertans make clear to him that's what they want.

And want it they should.

Albertans haven't seen a significant tax cut from their provincial government since 2001, and in fact swallowed a tax hike in 2002, when lagging oil and gas revenues spurred the Klein government to hike taxes by $641-million (including a 29% hike to the health- care premium).

The health-care premium tax is regressive and in no way reflects Albertans' use or risk-of-use of the health- care system. Plus, it would mean $1,056 back in the pockets of most Alberta families each year.

So, when you attend your local election forum, get a phone call from a campaign or run into a candidate in your local coffee shop, tell them it's time to eliminate the health-care premium tax.

You might just get what you ask for.

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Franco Terrazzano
Federal Director at
Canadian Taxpayers
Federation

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