Blog | January 10, 2013

By Darcy Henton, Calgary HeraldEDMONTON — Despite Alberta’s ballooning deficit, there will be no tax increases in the 2013 provincial budget, Premier Alison Redford said Wednesday.Although her key adviser mused Tuesday to the Herald that the province might have to look at raising taxes to address the fiscal crunch triggered by the lower-than-expected prices for bitumen, the premier told reporters hiking taxes was not in her immediate plans.“My preference is clear,” she said. “I don’t want to see any new taxes. It’s a commitment that I made and I want to keep my commitment.”She conceded, however, some members of the Tory caucus returned from Christmas break suggesting everything should be on the table, including tax increases, as the province faces its sixth consecutive deficit.“There are Albertans saying these are all options that are on the table, but I have made my view known,” she said.While opposition parties and the Canadian Taxpayers Federation argued the premier has left the door open to future tax hikes, Redford stressed repeatedly she intends to keep her campaign promise to not raise taxes in the 2013 budget.“Tax revenue will not be increased in this budget,” Redford said.She also rejected the possibility the province will have to borrow money to provide programs and services.“Absolutely not. Categorically not,” Redford said. “We will not borrow for operating.”With concerns this year’s deficit could soar far past $3 billion because of the widening price differential between light crude and bitumen, Lee Richardson, Redford’s principal secretary, said Tuesday the government has to look at a “different balance” of revenues and expenditures moving forward.“I think you just have to simply be realistic about it and pragmatic about it,” he told the Herald.Opposition critics say that by rejecting tax increases, the government will be forced to cut spending dramatically. Cabinet ministers have been directed to outline potential spending cuts of both five per cent and 10 per cent.“We’re going to have to make some tough choices,” Redford said Wednesday.Wildrose finance critic Rob Anderson said there’s still a danger tax hikes are coming in subsequent Tory budgets because Redford’s top adviser wasn’t likely speaking about tax increases without discussing it with the premier.“I would say that they are thinking about it,” Anderson said. “There’s no doubt in my mind.”The premier needs to reaffirm the commitment she made to not increase taxes in this budget, but also in budgets going forward, he added.Derek Fildebrandt, spokesman for the Canadian Taxpayers Federation, was also dubious about the pledge.“When she uses words like preference, it doesn’t sound definitive enough,” he said.The federation launched an online petition urging the premier to keep her promise.“The point of our petition is to show that this trial balloon is going to get shot down and that Albertans are in no mood for tax hikes,” Fildebrandt said.He claimed the PCs have increased spending by 37 per cent since 2005.“Revenues this year will come in at near record levels. They are just not going to come in at the fanciful, unrealistic projections that they made in the last budget.”NDP Leader Brian Mason said the premier is leading Albertans over a fiscal cliff similar to the one faced by the United States because of a dogmatic refusal to raise taxes on the wealthy.“When push comes to shove, they would rather cut health-care spending or education spending than increase taxes on their wealthy friends and their corporate sponsors,” he said.But speaking at the Canadian Home Builders’ Association economic forecast dinner in Calgary Wednesday night, Redford said Albertans have told the government their priorities are education, health care and support for the vulnerable.“We won’t turn our backs on the neediest,” she said.“Some of them require supports so that they can make the most of their opportunities, the opportunities our province offers.”However, Redford said the government would put an end to the automatic growth of budgets and would not shy away from hard choices and “cuts where necessary.”Alberta remains the economic driver of the country, but “2013 is going to be a tough year to navigate,” she acknowledged.Bill Moore-Kilgannon of Public Interest Alberta said residents are willing to discuss tax increases if they are justified and prevent major cuts to key programs such as health care and education.He said the flat tax system in Alberta must be reviewed because the average Albertan pays higher income taxes than residents of other provinces while wealthy Albertans pay significantly less.Programs cuts will hit poorer Albertans the hardest, he added.“What gets cut are the things that matter to low- and middle-income families,” he said.By Darcy Henton, Calgary Herald
With files from James Wood, Calgary [email protected]This article was published in the Calgary Herald on January 10, 2013. Read the article on the Calgary Herald website.