Released on October 21, 2008
Premier Brad Wall today announced:
- the largest single-year income tax reduction in Saskatchewan history;
- the largest amount of debt reduction in Saskatchewan history; and
- the largest investment in infrastructure in Saskatchewan history, while still maintaining a $1.9 billion cash balance in the Growth and Financial Security Fund.
"Our government is delivering a plan to lower taxes so that everyone will share in the benefits of Saskatchewan's prosperity," Wall said. "Today's announcement benefits every income tax filer in Saskatchewan - even those who pay no income tax currently."
Lower taxes will come in the form of increased personal exemptions - the amount of money a person can earn before starting to pay income tax.
The Basic Personal Exemption and the Spousal Exemption will each increase by $4,000 while the Child Tax Credit amount will increase by $2,000 per child. This will mean a tax saving of $440 per year for an individual, or $1,320 per year for a working family with two children.
"A working family with two children can now earn up to $41,300 before they start to pay any provincial income tax," Wall said. "That's the highest level of any province and it's one more reason Saskatchewan is the best place in Canada to earn a living and build a life.
"A total of 80,000 low-income taxpayers will drop off the tax rolls altogether. And those who pay no taxes now will benefit from a new Low-Income Tax Credit, which replaces and significantly increases the Saskatchewan Sales Tax Credit."
Other measures announced today by Premier Wall include:
- Allocation of an additional $1 billion from the Growth and Financial Security Fund to pay down debt. By the end of this fiscal year, debt will be reduced by almost 40 per cent, from about $6.8 billion to about $4.2 billion;
- The 2009-10 provincial budget will include a 50 per cent increase in the commitment to rebuild Saskatchewan's infrastructure - bringing the total investment to $1.5 billion; and
- A forecasted balance in the Growth and Financial Security Fund of nearly $2 billion - providing Saskatchewan with a fiscal insurance policy to protect against any unanticipated downturns in provincial revenues.
Wall said the measures are affordable and sustainable, because of the province's growing economy, increased revenues and reduced interest costs on debt.
"We expect our economy to weather the current economic storm, and Saskatchewan's revenues to remain strong," Wall said. "But at the same time, we are planning with caution by maintaining a $2 billion cash reserve - our province's fiscal insurance policy. This $2 billion cash reserve is the rock upon which Saskatchewan will weather that storm."
Wall said the measures are consistent with his government's vision for the future and build on the advice the government received from Saskatchewan people.
"When we asked Saskatchewan people what we should be doing with our increased revenues, by far the three most common answers were debt reduction, tax reduction and rebuilding our crumbling infrastructure," Wall said. "Today, we are following that advice with a plan to ensure Saskatchewan's growth continues and that everyone shares in our new prosperity."
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