Not All is Gloom And Doom with the Harmonized Sales Tax

Victor Boudreau - Credit

Fredericton – The provincial government has released more details on how a credit could help minimize the impact of a potential Harmonized Sales Tax (HST) increase on low and middle-income New Brunswickers.

Our government is focused on helping families and our most vulnerable. A credit would decrease the revenue associated with an HST increase, but it would help those who need it most. We want New Brunswickers to be aware of the credit option that we would consider as part of any potential decision about the HST.

An HST increase could generate up to $300 million per year. This revenue would help prevent major cuts to health and education. The HST credit option discussed below would reduce the amount of revenue generated by the HST by about $100 million but would provide a significant benefit to low and middle-income New Brunswickers.

  • Under this option, the full HST credit would be provided to anyone with a family income of less than $35,000 per year.
  • The full credit would be equal to $300 per adult and $100 per child (18 years old and under). Therefore, a family of two adults and two children receiving the full credit would be paid $800 annually.
  • Single-parent families that qualify for the full credit would receive $300 for their first child. That means a qualifying single-parent family with two children would receive $700.
  • The credit could be paid on a quarterly basis either by direct deposit or cheque.
  • The credit would be reduced by two cents for every dollar of income above $35,000.
  • This would mean that individuals with incomes of less than $50,000, or a family of two adults and two children with a combined income of less than $75,000, could receive a payment.
  • This credit would be more generous than the comparable HST credit offered by Nova Scotia.

Revenue generation has been raised repeatedly by New Brunswickers throughout our Strategic Program Review as a way to address our financial challenges and avoid major cuts to health care and education. This HST credit is one option we considered which provides the greatest benefit to low and middle-income New Brunswickers.

The HST was established in 1997 at a rate of 15 per cent replacing the combined Goods and Services and New Brunswick Provincial Sales tax rates of more than 18 per cent. The HST was at 15 per cent in New Brunswick from 1997 to 2006. The federal government lowered its HST rate in 2008 resulting in a combined tax rate of 13 per cent. Subsequently, Nova Scotia increased its share by two percentage points restoring the rate to 15 per cent in that province. New Brunswick is now considering doing the same as part of the Strategic Program Review.

Increasing the HST is one of the six key initiatives being discussed in the Choices to move New Brunswick Forward report. The others are:
.       rightsizing senior management in the civil service;
.       reducing spending on health care;
.       reducing spending on education;
.       introducing highway tolls; and
.       increasing the Corporate Income Tax.

The public is encouraged to find out more about all of the choices and the Strategic Program Review online.

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MLA Victor Boudreau Releases Additional Details On Highway Tolls

Toll model New Brunswick

January 20, 2016

Fredericton – The provincial government has released more details on choices related to highway tolls that could be pursued if the decision to implement tolls is taken as part of the Strategic Program Review.

It is important that New Brunswickers have all the information related to tolls so they can fully appreciate what the impact would be.

Electronic toll collection yields greater revenue with lower cost than manned tolling facilities. A one-time capital investment of about $16 million would be required to implement a network of eight electronic toll stations in New Brunswick with ongoing operations and maintenance of the network estimated to be $4 million annually. Electronic tolls would also require reciprocal agreements with other jurisdictions in order to permit tolling of visitors from outside New Brunswick. The difficulty in securing reciprocal agreements would have to be considered in any decision about whether to construct manned toll booths or electronic tolling stations.

The report Choices to move New Brunswick forward presented a possibility of eight electronic toll facilities throughout the province which would increase provincial revenues by about $60 million. With this model and based on average traffic volumes, the rates would be about 3¢/km for cars and 12¢/km for trucks. This would result in a round-trip cost of about $9 per car and $36 per truck to drive between Moncton and Saint John while the cost of a trip between Moncton and Edmundston for a car would be about $24 and the cost for a truck would be $96.

The idea of tolls was raised during consultations but there was disagreement as to where they should be located. We have looked at different models and each would have a different impact on drivers both local and visiting.

Two other possible toll models would be:
·         Placing electronic tolls at the four major border points in the province (Aulac, Edmundston, Woodstock, and St. Stephen). Under this model, about $43 million could be generated from a round-trip toll of $10 per car and $40 per truck. This option would require further study in terms of its compliance with international and domestic trade agreements and constitutional obligations. It could also have ramifications for those making regular trips across the border.
·         Placing electronic tolls around the three major cities of Fredericton, Saint John and Moncton. This model could disproportionately impact daily commuters in the province’s three main urban centres. Based on average traffic volumes, a round-trip rate of $6.30 per car and $25.20 per truck would increase revenue by an estimated $60 million. This rate could increase the average commuter’s travel costs by $1,575 annually but could encourage greater use of public transit.

Each of the revenue and toll amounts described above assumes the use of electronic tolling and would be contingent on reciprocal agreements being signed with other North American jurisdictions.

Manned tolling facilities would allow visitors to be charged a toll, but would require an additional $3.5 million in capital costs for construction along with annual operational costs of about $2.7 million per year for each facility. These costs could substantially reduce provincial revenue from tolls but would facilitate administering tolls to out-of-province visitors.

Once you look at the different factors, implementing tolls is a complex exercise. When making these tough choices, we need to ensure that no region or segment of the population is unduly affected.

Introducing highway tolls are one of the six key initiatives being discussed in the Choices to move New Brunswick Forward report. The others are:
·         rightsizing senior management in the civil service;
·         reducing spending on health care;
·         reducing spending on education;
·         increasing the Harmonized Sales Tax; and
·         increasing the Corporate Income Tax.

The public is encouraged to find out more about this choice and the Strategic Program Review online.


Choices To Move New Brunswick Forward

Victor-Boudreau-Review-2015

By André Faust December 01, 2015

The future is in your hands

Fredericton – Grand Lake Riding Association held their annual general meeting in Minto NB on December 1 2015, with key note speaker Roger Melanson Minister of Finance, Transportation and infrastructure.

Melanson, said the government is now creating jobs in provinces infrastructure and New Brunswickers are reaping the benefits of the new jobs that have been added. “Every part of the provinces is now seeing work being done to the provinces neglected infrastructure, putting hundreds of New Brunsickers to work..
Melanson went on to talk about Victor Boudreau’s Strategic Program Review. The review sets out the framework that the province will base its decision for the next budget; the focus is on three priorities.

  1. Job creationgrowing our economy to create opportunities for New Brunswickers to stay here or return home and for new New Brunswickers to move here, all the while generating tax revenue to help pay for important services;
  2. Getting our finances in orderif we do not make changes we will not be able to afford to invest in services like health and education to support families, nor programs that create the conditions for job growth; and
  3. Improving services for familiesmaking strategic investments in programs such as health, education, child care and senior care; and reducing poverty to make New Brunswick the best place to raise a family.

The Strategy is broken down into two categories Savings and Revenues, the details are found in the report.

Savings

  1. Administrative efficiency Estimated saving $10-15 million
  2. Reshaping the Civil service Estimated saving $20 – 45 million
  3. Consolidated customer contract centres. Estimated saving $3 – $4 million
  4. Consolidated non-medical laboratory services. Estimated saving $1.5 – $3 million
  5. Reducing visitor information centres, estimated savings $200,000 – $300,000
  6. Review of legislative officers, estimated savings $400,000 – $700,000
  7. Education (kindergarten to Grade 12). Estimated savings $50 – $70 million
  8. Reduce teachers to reflect decline in student enrollment. Estimated saving $10 – 12 million
  9. Reducing the number of education assistants. Estimated savings $3-$6 million
  10. Privatization custodial services. Estimated savings $5 – $7 million.
  11. Post-Secondary education. Estimated savings $15 – $45 million
  12. Reforming local governance. Estimated savings $25 – 30 million
  13. Motor vehicle registration process improvements. Estimated savings $200,000 – $500,000
  14. Outsourcing highway maintenance. Estimated savings $11 – $22 million
  15. Reforming transportation and infrastructure. Estimated savings $10 – $14 million
  16. Managing government builders more effectively. Estimated savings $1.5 – 3 million
  17. Transforming health care. Estimated savings $50 – $80 million
  18. Optimizing hospital laboratories and medical imaging. Estimated savings $20 – $23 million
  19. Pension Plans: school bus drivers, school custodians and nursing homes. Estimated savings $7.5 – $9 million

Revenues

  1. Monetizing name privileges. Estimated revenues $1 – $2 million
  2. Monetizing da registries. Estimated revenue $8 – $10 million
  3. Monetization of NB Liquor. Estimated revenue $15 = $20 million
  4. Monetizing parks and attractions. Estimated revenue $3 – $5 million
  5. Targeting the illegal trade of tobacco. Estimated Revenue $2 – $4.5 million
  6. Increase Tobacco tax. Estimated revenue $7 – $25 million
  7. Increase the HST. Estimated revenue $175 – $295 million
  8. Increase the corporate income tax. Estimated revenue $12 – $25 million
  9. Highway toll to recover highway maintenance costs. Estimated revenue $60 million
  10. Increased diesel tax. Estimated revenue $40 – $45 million
  11. Increase the Real Property Transfer Tax. Estimated revenue $4 – $10 million
  12. Increase Insurance Premium Tax. Estimated revenue $15 – $20 million

Each Saving and Revenue will have an serious impact on all New Brunswick, it’s worth to read the review and following your review, let your MLA know what think which will be the last step before government decides to adopt parts of this review.

This story is a work in progress you can expect future stories analyzing each categories, Savings and Revenues.

The complete report is below



Tories to divert attention in face of scandal, say Liberals

Liberal MLA Victor Boudreau
Shediac—Cap-Pelé

FREDERICTON – With the Alward Conversatives mired in scandal there will be attempts this week to focus attention elsewhere, say the Opposition Liberals.

“I wouldn’t be surprised to see some kind of announcement,” said Liberal MLA Victor Boudreau. “Deputy Premier Paul Robichaud and Minister Mike Olscamp have been connected to a very serious case of obstruction of justice. The ongoing trial is causing the Conservatives a lot of grief. It’s unfortunate that it takes a political scandal to finally get some action out of this government.”

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