Manitoba government says budget will tackle possible coronavirus effects

Manitoba government says budget will tackle possible coronavirus effects

WINNIPEG — It’s budget day in Manitoba and the Progressive Conservative government says the new fiscal plan will take into consideration the economic effects of the novel coronavirus.

Premier Brian Pallister says the budget will outline a number of scenarios, including reduced economic growth and what that could mean for the province’s bottom line.

With stock markets falling and organizers of large public events considering cancellations, Pallister says the province is preparing for any outcome.

On the spending side, the government plans to spend $35 million for additional personal protective supplies — such as gloves, face masks and shields — for health-care workers and patients.

Pallister says the province is in a better position than it was a few years ago, because his government has added hundreds of millions of dollars to its rainy-day fund.

The fund had just over $100 million in 2016, and had reached $571 million at the end of the last fiscal year.

“We needed to beef up our rainy-day fund … so we had the assets available for deployment, rapidly, instead of having to go cap in hand to a bank or lending agency of some kind to get assistance,” Pallister said Tuesday.

His Tories were re-elected last year on a promise to balance the budget by 2023 while also cutting taxes. The government recorded a deficit in the 2018-19 fiscal year of $163 million and is projecting a $325-million deficit for the current year that ends March 31.

There have already been two tax cuts in advance of the budget. One is a higher threshold for a payroll tax that employers pay. The tax currently kicks in when a company’s payroll exceeds $1.25 million a year. That level is to rise to $1.5 million next January.

The Tories are also cutting the provincial sales tax by one point to six per cent as of July. A new carbon tax of $25 a tonne is also coming in then, but the tradeoff is forecast to cost the provincial treasury about $40 million annually.

Pallister said the tax cuts are manageable and will help the economy.

“Our advantages in terms of private-sector attractiveness and job growth … are at least in part due to the fact that we’ve been able to create a more certain environment in respect of not jacking up taxes on an annual basis.”

Opposition NDP Leader Wab Kinew said Pallister’s focus on tax and spending cuts is hurting the province. He pointed to the cut in the payroll tax.

“The idea is we’re supposed to use this to pay for health and education, so if you cut it, what happens? Well, you’ve got to cut health care and you have to cut spending in education,” Kinew said.

This report by The Canadian Press was first published on March 11, 2020

Steve Lambert, The Canadian Press

The Canadian PressThe Canadian Press

Recent Stories

Send us your news tips and videos!