NDP says it would cancel corporate tax breaks, raise income taxes on high earners in shadow budget
Alberta’s Opposition NDP outlined its own approach to the province’s finances Monday, proposing tax increases on corporations and high-income earners in its first shadow budget.
Following the passage of the United Conservative government’s first budget last week, NDP Finance critic Shannon Phillips said her party, were it in power, would introduce a one-per-cent income tax increase on the top one per cent of income earners — those who make $315,000 or more annually.
“This budget would turn this premier’s terrible and reckless plan on its head,” Phillips said at a news conference on Monday.
The NDP shadow budget proposes balancing the provincial budget a year later than the United Conservative Party government’s plan, hitting a surplus of $412 million by 2023-24.
Reversal of repeals
The NDP’s plan would revive several policies it passed while in government that have since been repealed by the UCP.
For one, it would hike the corporate tax rate back up to 12 per cent. The UCP government has enacted a plan to lower the general income tax rate on businesses to eight per cent over four years.
Phillips said the UCP’s claim that the NDP-era business tax hike drove companies away from the province is spurious, noting that Alberta led the country in economic growth in 2017 and 2018, despite low oil prices.
Instead, Phillips says it is the UCP’s decision to dismantle the NDP’s climate plan that is hurting employment and investment, especially in clean tech.
The NDP’s financial assumptions include carbon taxation and a continuation of the crude-by-rail contracts signed by the previous government. The UCP plans to dump them at a cost of $1.5 billion, or about $300 million less than it says carrying them out would have cost.
Tuition increases would be limited to the rate of inflation under the NDP plan, whereas the UCP has capped increases at seven per cent per year for the next three years.
The NDP also said it would expand the $25-a-day childcare pilot and keep the classroom improvement fund, school nutrition plan and curriculum rollout in place.
The shadow budget projects these proposed changes would result in a deficit of $1.7 billion in 2022-23 — the year the UCP says the budget will be balanced.
Debt numbers missing
Absent from the official document is any mention of debt, but party sources told AB Today the NDP’s plan would land the province in $3 billion more debt by 2023 than the UCP’s debt assumption of $93.2 billion by the end of 2022-23.
Economic Development Minister Tanya Fir took to Twitter to slam the NDP’s plan as a “disaster in the making,” noting its lack of debt projections and mocking it for being “a mere 28 pages.”
NDP blames delayed release on manic fall session
The NDP originally pledged to release the shadow budget during the fall session, but Phillips said it was delayed due to the volume of legislation and the limited resources the NDP has as an opposition party.
“We did want to release it sooner, but we have been dealing with omnibus bills being rammed through the legislature by the UCP government,” she said.