MORE MONEY ON YOUR JULY PAYCHEQUE

Released on June 19, 2000

Major income tax cuts are on the way for Saskatchewan residents, beginning with

a 50 per cent reduction in the flat tax July 1st.



This will save the average Saskatchewan family $250 on the 2000 tax form. A

portion of that savings will start showing up on paycheques after July 1st.



Legislation before the assembly creates a new tax system and substantial tax

reductions over the next four years. The legislation is part of the major tax

reform package announced in this spring's budget, where the average family will

save about $200 this year, including adjustments to the PST, and about $1000 by

2003. Finance Minister Eric Cline moved second reading of the legislation

June 19th.



"Our government is committed to make the changes needed to keep our economy

growing and create opportunities for Saskatchewan people," Cline said. "Tax

reform is fundamental to keeping our province competitive."



The legislation enacts in law the government's plan to lower taxes and

implement a simpler income tax system. Under the plan:



the flat tax will be reduced from 2 per cent to 1 per cent July 1,

2000, saving the average Saskatchewan family $250 in the 2000 tax year;



the flat tax, debt reduction surtax and high income surtax will be

abolished on January 1, 2001;



provincial income tax will be determined directly from taxable income,

effective January 1, 2001; and,



higher basic personal tax credits will apply for all Saskatchewan

people as of January 1, 2001.



"I am particularly pleased with tax credits targeted specifically to seniors

and parents," Cline said. "Saskatchewan is the only province to include these

special credits in its tax reform plan. As a result of tax reform, about

55,000 low income earners will be removed from the tax rolls altogether."



Other key features of tax reform include a planned return to indexation to

eliminate "bracket creep" and a reduction in the capital gains tax rate for

farmers and small business to 11 per cent.



Cline further noted the provincial taxes (sales tax, gas tax, income tax

combined) paid by an average Saskatchewan family have gone from the second

highest in the country in 1993 to the fourth lowest this year.



"That's progress. The changes we are tabling today will secure the simple,

fair competitive tax system we need for even stronger growth and opportunities

for the people and the province of Saskatchewan."



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For further information, contact:



Sandra Lodoen

Saskatchewan Finance

Regina

Phone: (306) 787-6578.