Released on December 28, 2012
Family of Four Now Can Earn Nearly $48,000 Before Paying Provincial Income Tax
Indexation of provincial income tax will continue to protect Saskatchewan people from inflation and save Saskatchewan taxpayers an estimated $20.2 million in 2013.
Individual taxpayers now pay no Saskatchewan income tax on their first $18,455 of income while a family of four pays no Saskatchewan income tax on their first $47,790 of income - the highest tax-free income threshold for a family of four in Canada.
"A family of four with $50,000 annual income has now seen their provincial income tax cut by more than 90 per cent since our government took office," Finance Minister Ken Krawetz said. "In 2007, they would have paid about $2,300 in income tax and in 2013, they will pay about $200 in income tax - a savings of more than $2,000 a year.
"Ensuring that provincial taxes are competitive and as low as possible has always been a priority of this government and is an important part of our government's Plan for Growth. Continuing to index the income tax system to inflation every year is one of the ways we are keeping life in Saskatchewan affordable."
Since 2008, Saskatchewan residents have saved more than $300 million through lower personal income taxes, and 114,000 low-income Saskatchewan residents have been removed from the tax rolls. The Saskatchewan government has taken a series of steps to reduce personal income taxes over the past five years, including:
- Increasing personal, spousal and child exemption amounts and introducing a new Low Income Tax Credit in 2008;
- Introducing a new Active Families Benefit of $150 per child for cultural and sports activities in 2009;
- Raising personal, spousal and child exemption amounts again in 2011;
- Expanding the Active Families Benefit to include all children 17 and under (previously, it only covered ages six to 14) and introducing a new First-Time Homebuyers' Tax Credit in 2012; and
- Indexing all income tax brackets and credit amounts each year to the rate of inflation to protect Saskatchewan taxpayers from "bracket creep." In 2013, all of these amounts are being increased by two per cent.
When income tax savings are combined with new tax reduction programs introduced since 2007 that include the refundable Low Income Tax Reduction and the Active Families Benefit, a single person with $25,000 annual income will benefit from $839 in lower provincial tax in 2013 than in 2007. A family of four with $50,000 combined income will see tax savings of $2,722 and a family of four with $75,000 combined income will see tax savings of $2,493, when comparing 2013 to 2007.
"These are significant savings for Saskatchewan families," Krawetz said. "By the end of 2013, that family of four with $50,000 income will have saved well over $12,000 through our government's tax reductions. Making life more affordable for families is a big part of the Saskatchewan Advantage."
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For more information, contact:
Brian Miller
Finance
Regina
Phone: 306-787-6605
Email: brian.miller@gov.sk.ca