Province’s net financial position could decrease by another $14 billion in 2016/17, making it a net debtor province.
The last thing businesses and consumers need is yet another new tax piled on top.
Today's Alberta budget forecasts a $6.1 billion deficit for this fiscal year, and the province is on track to record 10 budget deficits in 11 years.
Let’s look at the expected fiscal balances in Canada’s 10 provinces for 2015/16.
When Finance Minister Joe Ceci unveils Alberta’s budget on Oct. 27, Albertans can expect a sizeable deficit. In fact, the government’s latest data suggest a $5.9 billion deficit, but Minister Ceci has cautioned it could be “in the range of $6.5 billion.” In either case, the amount isn’t trivial.
With a large deficit looming, it's a good time to put Alberta’s finances in longer-term perspective.
There are many parallels between Alberta’s first NDP premier, Rachel Notley, and Ontario’s only NDP premier, Bob Rae.
Forty-one billion dollars. That’s the extra amount, over and above what was needed to keep pace with population growth and inflation between 2006 and 2013, this to fund Alberta government program spending in those years.
The last time Alberta was in a fiscal mess due to low energy revenues and over-the-top government spending, some politicians and pundits said what Albertans really needed was higher taxes. That was back in the late 1980s and early 1990s. Those voices were wrong then and they are wrong now.
For one thing, any fantasy that a tax hike will solve Albertas fiscal woes is the preserve of people who dream in tax-happy Technicolor.
Sure, tax reform is desirable. A provincial sales tax would be smart economic policy since sales taxes are some of the least harmful imposts.