Column – Progressive View: Revenue Bubble

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Tristan cropBy Tristan Turner

With the provincial budget imminently on its way, I’ve began to take stock about the economic and social realities of Alberta today, and what I hope to see in the years to come.

Although I disagree with Premier Redford on a great many areas of her administration, we are in agreement on some things regarding her report to Albertans on the province’s fiscal realities. The reality is government has to make choices – difficult choices – to provide the best service to Albertans while ensuring future generations aren’t stuck with enormous debts. Though the PCs shouldn’t have relied so heavily on resource revenues (an incredibly volatile source of provincial income) to make their budget predictions, the reality is that the total amount received by resource revenues is significantly lower than expected, and the government is going to have to readjust their budget plans.

So, what do we want the future of our province to look like in light of these recent developments? Instead of finding sources of revenue elsewhere, it appears the PCs are looking to trim programs and rack up a large deficit. Instead, I have a different proposal. Why don’t we just tax what we spend? I know it’s a simple principle, but all too often governments would rather incur large debts in lieu of doing their jobs and balancing the books.

Then where do we look for revenue now that we have found out the hard way that we can’t rely on incredibly volatile resource royalties to pay for essential programs like health care and education? The PCs and the Wildrose keep saying that we couldn’t possibly increase taxes because that would “prevent private sector investment”. That’s a nice narrative, but the reality is that Alberta could pull in $11 Billion dollars more of tax revenue and we would still have the lowest tax rates in Canada, and some of the lowest in the world.

Alberta is the only province in Canada that has a flat income tax. It doesn’t matter if I’m a school janitor or a big oil executive; we all pay the same in income tax rate. In this day and age, that’s not only ludicrous, it’s reckless. No wonder why the PCs are having trouble balancing the books. When the government approaches a difficult budget scenario like this, it’s irresponsible to take increasing revenue off the table.

The expected deficit in the budget to be tabled Mar. 7 is $4 Billion. This isn’t an enormous number, but it’s absolutely unnecessary. Alberta is a major economic powerhouse and we can more than afford to cover that in new government revenue. The reality is there is one simple solution to the government’s budget woes – tax what you spend. Gut the wasteful practices we’ve seen the government commit since the election (we of course cannot forget the Olympic attendance scandal) and introduce a progressive income taxation system like the rest of Canada.

All the reliable sources are saying it, and the verdict is in. Alberta is suffering from a revenue problem, not a bitumen bubble.

For the sake of the province today and tomorrow, the Alberta government needs to take a new approach to how we structure taxation to insure we live in a prosperous, fair and debt free Alberta.

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1 Comment

  1. Dude, you have so much enthusiasm, which is commendable. Unfortunately your ideas would lead to long-term disaster for the province.

    I HIGHLY recommend you read some delniski.blogspot.ca articles. Doug is a former MLA, one who actually understands both gov’t and private sectors, and how they run their budgets.

    Imagine a small family tryng to run a budget in the manner you’re proposing. Oh, the now that we promised Suzy dance lessons and Billy hockey lessons? No problem. Main breadwinner, we’re going to demand a higher percentage of your earnings. No you can’t grab a beer with friends anymore. And no you may not subscribe to Sportscentre, and NO it doesn’t matter if you’ve “earned it”. We know that these lessons really matter and your future state of mind or future happiness in this family are insignificant. You will always feel motivated to perform more and earn more, and we will keep expecting it.

    Again, Dude, what you write only SOUNDS nice. It doesn’t actually WORK in the long run; at least, not for everybody’s benefit. And you ARE trying to be FAIR, aren’t you?

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