Another Tax Increase Coming?

After both expanding the number of things the Provincial Sales Tax (PST) is charged on and then increasing the rate from 7% to 8%, it’s hard to believe that the NDP could actually be coming back to Manitobans with another tax increase. But that is exactly what they were signaling as a possibility this past week.

First came the news that the 2014-2015 provincial deficit is expected to be higher than originally forecasted because the NDP have overspent again. Now the NDP are saying that the province will be in the red this year by $402 million, $45 million higher than originally predicted. The massive deficit comes despite the fact that the NDP are collecting hundreds of millions of dollars in new tax revenue. Clearly they have a spending problem, not a revenue problem.

Adding insult to injury is the fact that the new financial numbers show that the NDP have failed to live up to their promise to use all of the revenue from the increase in the PST for roads. More than $100 million in new PST money has gone into general government revenues instead of into fixing roads and bridges as promised by the NDP.

A few days after these bleak numbers were released, the federal government announced that they would be increasing transfer payments to Manitoba by 2.2 per cent. Instead of welcoming the increase in funding, the new NDP Finance Minister quickly said that it wasn’t enough and that he was “disappointed” with the increase.

What has become abundantly clear is that it doesn’t really matter how much more the NDP takes from Manitobans in taxes or how much more the federal government provides in transfer payments, it is never going to be enough for the NDP. Their record indicates that regardless of their revenue, the NDP overspend and just keep piling on the provincial debt.

Already this year the credit rating agency, Moody’s, downgraded the outlook for the province because they no longer believe the NDP can return to a balanced budget. That seems more evident than ever and it will cost our province more in interest payments on debt both in the short term and in the long term.

Most troubling is what this means for taxes in our province. Recent history shows that the NDP have little concern about asking Manitobans to pay more for their overspending. When asked by the media whether the recent financial news means that there is another tax increase coming, the NDP Finance Minister said that he was going to crunch the numbers and decide later. Those words should have every Manitoban once again clutching their wallets tightly.