It naturally doesn’t get the attention it did when inflation was running at seven or eight percent and interest rates were increasing seemingly every month, but Manitoba continues to record among the highest inflation rates in the country month after month. The most recent data that was released, for July, shows that the inflation rate for our province was 4.2 percent. That is well above the national average of 3.0 percent.

While some of the persistently high inflation can be attributed to high gas prices, which are well beyond the control of any provincial government as they are being driven by a war in the middle east, the fact that Manitoba continues to be at or near the top of the country month after month for inflation should be concerning. This is especially true because the nature of inflation is that it continues to compound month after month. So already high prices continue to get higher. This is most noticeable in the grocery store, where food inflation in Manitoba has ranked the highest in the country several times this year.

While the provincial government tried to make a great deal of fanfare over the fact that they had removed the provincial sales tax from food in the grocery store, it didn’t take long for Manitobans to realize that almost all food is already exempt from PST. So, for Manitobans, these savings amounted to pennies. At a time when food inflation continued to lead the country, more support was needed. And while it is true that government cannot entirely ease the burden that Manitobans and Canadians generally are feeling with increasing costs, at the very least there is an expectation that they will not make a bad situation worse.

This was the case in Manitoba when the NDP made the decision, after they were elected, to stop indexing tax brackets to inflation. Under the previous Manitoba PC government, tax brackets were indexed to inflation, meaning that every year the tax brackets increased so that Manitobans who were given a pay increase would not necessarily bump into a new tax category where they ended up paying more. By eliminating this, the NDP have brought in what many economists call a “sneaky tax” because it is not very visible and can mitigate the positive impact of a pay raise.

This is bad policy at anytime; it is especially bad policy when people are struggling to make ends meet in an affordability crisis. As we head toward fall and the return of the Manitoba Legislature, it is also the time when government begins to put together the budget for the coming spring. Much can change in the course of several months, but it is certain that Manitobans will still be under the weight of significant affordability pressure. If the NDP are looking to provide meaningful tax relief, they will significantly increase the basic personal tax exemption to allow people to keep more of the money they earn before being taxed. That is the type of tax relief that is needed to make a noticeable difference for Manitobans.