Manitoba Hiking PST to 8% on July 1

Manitoba Legislative Building (CHRISD.CA FILE)
Manitoba Legislative Building (CHRISD.CA FILE)

Manitobans will have to open their wallets a little wider on July 1 as the province hikes the provincial sales tax by one point.

The tidbit was just one highlight in the $14.8 billion 2013 budget released on Tuesday, setting the PST to go up to 8% on purchases and other services on Canada Day.

The tax hike will fund infrastructure and be a temporary measure in place for 10 years, according to Finance Minister Stan Struthers. The increase is expected to cost the average household an additional $25 per month.

At the same time, the province is removing the PST on baby items, such as diapers, strollers and car seats.

Minimum wage will also increase in October 2013 to $10.45 per hour from the current $10.25.

Effective at midnight tonight, the province will also have STARS air ambulance service providing 24-hour support at a cost of $1.8 million annually, up from its current 12-hour schedule.

Other highlights

  • School property taxes for seniors 65+ to be eliminated by 2015.
  • Fishing licence fee doubles to $10 from $5.
  • A package of cigarettes is going up by $1 at midnight, or four cents per cigarette.
  • Basic personal tax exemption and spousal and dependent exemptions rising to $250.
  • Vehicle impound recovery cost going up $20 to $135.
  • Province cuts annual subsidies to the Manitoba Jockey Club to $4 million from $9 million.
  • Tax on financial institutions is going up (banks and credit unions) — often passed on to the customer in banking fees.
  • Small business tax exemption extended to more businesses.

Spending

  • Government spending to increase by 3.1%.
  • Health and education spending projected to rise by 4.5%.
  • Manitoba has budgeted $30 million to fight this year’s flood, of which 90% is recoverable through Disaster Financial Assistance.

Struthers said the province hopes to balance its books and eliminate the $518 million deficit by 2016-2017.

Budget reaction

“Enough is enough. The NDP ran on a promise not to raise taxes on Manitobans and have blatantly lied to Manitobans. This is a government with a spending problem. Even with a quarter billion in new taxes this year, the NDP is ducking responsibility and has not only failed to reduce the deficit and the debt that comes with it, but have increased the amount of red ink by $502 million.” — PC Party Opposition Leader Brian Pallister

“The NDP turned their backs on the poor by increasing the ‘executive support’ department budgets by millions while refusing to raise shelter rates.” — Liberal Leader Jon Gerrard

“Make Poverty History Manitoba (MPHM) along with its 145 supporting organizations are disappointed that our government has not done enough to close the monthly housing affordability gap that the poorest Manitobans face.” — Kirsten Bernas, Make Poverty History Manitoba

“We recognize our province is facing fiscal pressures and we appreciate that this is a tough budget year. We also know that it is even more important during difficult times to invest in post-secondary education since our graduates will drive our economy out of its current challenges.” — David Barnard, president of the University of Manitoba

“The government has committed to increasing its investment in programs and supports to help Manitobans go tobacco free but we have not yet seen the progress need to significantly reduce smoking and therefore cancer in Manitoba.” — Mark McDonald, executive director for the Canadian Cancer Society, Manitoba Division

“We are disappointed but not surprised that the provincial government has revoked its commitment to provide stable operating grants of 5% for three years. We understand the Manitoba flood of 2011 put increased fiscal pressure on the province.  However, slashing the committed increase to our operating grant in half, while at the same time insisting through legislation that tuition rates remain well below the Canadian average (only Quebec has lower tuition rates), increasingly hobbles our ability to meet the multiple needs of the diverse student body we serve.” — Lloyd Axworthy, president of the University of Winnipeg


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