As he has done the past two years, Finance Minister Cameron Friesen provided a detailed look at his government’s budget to the Manitoba Chambers of Commerce (MCC) members and guests at our annual post-provincial budget MBiz breakfast presented by 6P Marketing.
On the heels of a budget that saw a significant decrease in the provincial deficit, Minster Friesen spent more than half an hour highlighting the work his ministry has put in, trying to walk a fine line between putting the pieces in place to grow the economy and making the tough choices, they feel are required, to balance the books. One of the highlights of the budget was the announcement of the increase to the basic personal tax exemption to $10,392. The amount of money you can earn before taxes will go up a total of $2,020 to $11,402 by 2020, from $9,271 in 2017. The minister acknowledged that while the rate is still well below Saskatchewan ($16,065), the government has made the decisions necessary to start the process to close that gap.
The other big takeaway from the budget and one that remains something that MCC will continue to work with the government to work on is the details surrounding the revenue collected from the carbon tax, effective September 1, 2018. When announced last fall, MCC hoped the government would use the revenue collected to invest in green technology and other green initiatives, ease the burden on industries like trucking and manufacturing, while still providing some of the revenue back to Manitobans. When pressed on the choice made by the government, Minister Friesen said the answer was simple; they preferred to provide Manitobans with tax relief and feels, given the circumstances, it was the right decision.
From the perspective of MCC, the budget was another small step forward. The budget hits on a few issues that we have been very vocal on, including:
- Raising the basic personal exemption;
- $50,000 increase in the small business exemption to $500,000 from $450,000, which will create a saving of as much as $6,000 per business; and
- Enhancing the small business venture capital tax credit by eliminating the $15 million revenue cap to allow more companies to qualify.
A consistent message from MCC has been for the province to show a path towards achieving a balanced budget. There appears to be a light at the end of the tunnel, and the path is beginning to be seen. However, there remains a concern as the province’s net debt will hit $25 billion, up from $24 billion. Debt servicing costs will surpass $1 billion.
As the breakfast concluded, MCC President and CEO Chuck Davidson asked the minister to describe how this budget will be perceived ten years from now, Friesen replied, “I hope they say that we (government) were truly up to the challenge. That we listened, and that they did what they said they were going to do, and they were working hard for the trust of Manitobans.”