Why Doing Politics Differently Means Considering All Options – Including a Value Added Tax for Alberta
Albertans are proud of being the lowest-taxed jurisdiction in Canada. We’ve managed to do that over the years by relying on resource revenues and royalties from non-renewable oil and gas that Alberta has had in abundance.
Fiscal Responsibility is a Core Value
As proud Albertans, we talk about fiscal responsibility as a core value. Albertans live within their means, and they expect their government to do the same.
But natural gas prices plummeted, along with natural gas royalties. More recently the price of oil has gone from a high of around $130 per barrel to a low of about $30 a barrel, to today’s prices hovering around $65 a barrel. We’ve been able to spend lots when times were good, but faced large deficits or service cuts when resource royalties shrank. That’s no way to run a provincial budget.
Albertans have been hit hard with job losses and salary cuts. Dependent on resource revenues, the Government of Alberta faced revenue shortfalls at the same time, reducing the amount that could be made available to cushion the economic blow.
As Leader, I commit to an Alberta Party that makes sure tax dollars are spent wisely. Through careful monitoring, internal and external audits, and reviewing the programs and services offered by the Government of Alberta, we can ensure that our government is delivering on its core functions and work towards transitioning non-core functions to the non-profit or private sectors after careful consultation and a clear transition plan. By empowering our public sector and aligning the goals of our government workers, health care professionals and educational staff with the outcomes we seek, we can help reduce our public sector’s frustrations at roadblocks they face to delivering high-quality services at the same time as making government more efficient.
But even after that process is done, we’re facing a structural deficit in Alberta of billions of dollars. And neither the NDP nor the UCP have any plan to address closing that revenue gap.
Non-residents use our Infrastructure
In Alberta today, hundreds of thousands of visitors and non-residents use our infrastructure like roads, bridges and public transit, as well as some public services, but they don’t pay any income tax in Alberta. Alberta could consider introducing an HST that keeps Alberta’s point of sales taxes lower than all of our neighbours, while still collecting revenue from these visitors to our province. Each of our neighbouring provinces collect sales taxes from visitors, contributing to the delivery of their provincial government services. Albertans are missing out.
A Point of Sale Tax Harmonized with the GST is Simple for Alberta Businesses
It hurts Alberta businesses every time there is a complicated new rule or set of forms to fill out. It means business owners need to take time and effort away from running their businesses to do administrative work. That’s why I support eliminating the separate Alberta Corporate Income Tax Return - an unnecessary administrative burden on Alberta corporations. When it comes to a point of sale tax, with an HST, no new forms are needed. Both the Alberta Government and business owners can use the same returns and forms our Alberta businesses already fill out to account for a proposed provincial value added tax. AND our businesses would get input tax credits for all of their supplies, meaning that the tax burden placed on businesses is lower than what we see with something like the NDP’s new Carbon Tax.
We need to consider all of the tools in our toolbox to get the job done
We need to look at doing an overall review of the Government of Alberta’s revenue sources, using all the tools in our toolbox to come up with a fresh approach. Is it time to adjust personal income tax rates and the level of the basic personal exemption? Introduce a point of sale value added tax to allow for predictable, sustainable funding? Improve corporate income tax rates to be more competitive with neighbouring jurisdictions? These are all policy positions that can be debated at the upcoming Alberta Party policy conference.
Recently I proposed a new, lower tax rate for Alberta small businesses earning between $500,000 and $1 million, so that they will effectively pay a 7% business tax rate instead of the current 12% Alberta corporate tax rate that they pay now, to help our Alberta businesses grow and stay in Alberta. These types of solutions are possible if we look at the overall picture of revenue in Alberta and take a long-term view, not just for getting elected in one year or five years, but for setting Alberta on a sustainable path to prosperity for the long term.
The Alberta Party needs Bold Ideas to Attract Support
This is what a fresh, new approach to politics looks like. It means having the courage to identify a problem and take a calculated risk on a solution that is good for the long-term future of our province. If we put forward the same plan full of the same ideas Albertans have seen before (and now rejected) – if we don’t stand out from our opponents in the NDP and the UCP, then we’ll fail to give voters a clear reason to choose the Alberta Party and our vision for the future. That’s what putting Province before Politics is all about.