Manitobans Pay Tax Too Soon
In every province residents are able to earn a certain amount of income before they begin to pay income tax on their earnings. That level is referred to as the basic personal exemption, the amount you can earn before government begins to apply income tax.
In Manitoba, the basic personal exemption is $8,634. That means that every Manitoban can earn that amount before provincial income tax kicks in. If that doesn’t sound like much, it isn’t. In fact, the amount hasn’t moved up very much under the NDP government. It hasn’t even kept up with inflation.
And it sure hasn’t kept up to what our neighbors in other provinces have been doing. In Alberta for example, residents can earn more than $17,000 before provincial income taxes start to be taken off. Even in Saskatchewan the basic personal exemption is nearly $15,000.
So why is Manitoba so far behind virtually every other province in letting residents keep more of their income before taxes are taken off? Quite simply, the NDP government just isn’t willing to allow these tax dollars to stay in the pockets of the people that earn them.
Last week, Progressive Conservative Leader, Brian Pallister said that as a step forward, Manitoba should increase its basic personal exemption rate noting that moving it to the Canadian average ($10,617) would save $200 for every person in a household earning at that level or more.
While that is a modest tax saving, for those on the lower end of the income scale it can be significant. For a working couple, it can make the difference in being able to pay for their kids to be involved in a sport or other activity. For a student who is working in the summer months and saving for school, it can help with the purchase of books or supplies. In short, while an increase in the basic exemption level offers a tax cut to everyone, it has the greatest impact on those who need the money the most.
Increasing the basic personal exemption would also be a sign that Manitoba is interested in being competitive with other provinces. Last year, 5,000 more people left Manitoba for other provinces than came here from other provinces. We need to ensure that we are doing the best we can to remain competitive with our provincial counterparts.
The NDP government has been reluctant to increase the basic personal exemption since they have come to government. They want as many people paying taxes, even at the lowest levels of income, as possible. That certainly isn’t the attitude in other provinces and it’s not one that serves Manitoba or Manitobans well.