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Where are Saskatchewan's Tax Pioneers

Author: Richard Truscott 1998/11/16
This article is about provincial income tax, and the need for bold action. But first I have to ask - Where are our pioneers

Saskatchewan has always been a place for trailblazers; from the pioneers who settled the harsh prairie, to the innovators who made this province the birthplace of co-operatives and many modern social programs. Whether you agree with these policies or not, one thing is for certain, Saskatchewan has always been a province where new things happen.

But since then, the leaders of our province settled into a comfortable rut. Just as the world began moving more quickly, our politicians seemed to slow down.

Many of Canada's other provinces, with varying degrees of success, have moved with the times - economically, socially, and politically. But what of Saskatchewan The debates over Crown Corporations, taxes, farm incomes, etc. would not be out of place in the 1960s or 70s. But they are out of place in the latter part of the 1990s.

The people of Saskatchewan need to demand more of their leaders. You deserve more. We need to recapture the spirit of innovation and achievement that has been the source of Saskatchewan's greatest successes, and use it to propel us forward.

Perhaps our government should take some inspiration from the Alberta Income Tax Review Committee. This committee, comprised of government MLAs, recently shocked Alberta with a bold proposal to reform provincial income tax. Their recommendations were essentially threefold:

First, stop calculating provincial income taxes as a percentage of federal income tax. In other words, take control of the provincial income tax rate away from Ottawa

Second, have a flat 11% provincial income tax rate, and double the personal and spousal exemptions to about $12,000. Taxes remain "progressive" because lower income people pay tax on a much smaller portion of their income, thanks to the larger personal exemptions. At the same time, people will not be penalized with higher tax rates as their income increases.

And third, fully index taxes to inflation. By not accounting for inflation, federal and provincial governments have used "bracket creep" to steal billions of dollars from the pockets of taxpayers whose real income has not increased. Full indexation of provincial income tax will help put an end to this crooked and costly scheme.

Alberta's income tax proposals will return $500 million per year in the form of lower taxes. Thanks to increased basic exemptions, 78,000 low-income people will drop off the provincial tax rolls entirely. This will be welcome relief, especially considering the higher CPP premiums that are on the way.

Which brings me back to my first question: Where are Saskatchewan's pioneers

We can't let our provincial government sleep through yet another economic and fiscal innovation. It's time for our government to move out of the 1970s and into the 21st century with a "Made In Saskatchewan" income tax system that serves the needs of Saskatchewan taxpayers!

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Franco Terrazzano
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