Alberta to use $13.2 billion surplus to pay down debts

Finance Minister Jason Nixon says his administration plans to use the surplus to make historic investments in savings and debt reduction.

“For too long, governments in Alberta refused to exercise fiscal discipline during boom times. Those days are over,” says Nixon. “Alberta’s government is making the prudent decision to save and invest surplus revenues so future generations can benefit from the prosperity of today.”

Taxpayer debt in Alberta as of March 31, 2023, is forecast to be $79.8 billion, about $10.4 billion less than what had been estimated in this spring’s budget.

The government is adding $1.7 billion to the Heritage Savings Trust Fund, a long-term savings account that funds programs across the province from the interest it generates. The Heritage Fund will now have a total of $2.9 billion.

The province will also recommit to indexing personal income taxes to inflation, retroactive to the 2022 tax year. The basic personal tax amount is rising to $19,814 and will increase again in 2023.

This means that about another 80,000-95,000 Albertans will join the 1.3 million tax tax filers who already pay no provincial personal income tax.

Kenney says indexation will save the average taxpayer around $300 when they file their taxes this coming spring.

“Alberta’s commitment to fiscal discipline and our unrelenting focus on economic growth has helped bring about an extraordinary turnaround in our financial situation,” says Kenney. “We promised Albertans we would get our fiscal house in order and that’s exactly what we’ve done. Now, we’re paying down debt so future generations won’t have to, saving more for a rainy day, and putting more money in Albertans’ pockets.”

“Despite this record amount of resource revenue money flowing into government coffers, Alberta families are not feeling the benefit,” said NDP Energy Critic Kathleen Ganley. “In fact, many Albertans are struggling to make ends meet.”

On Tuesday, outgoing Premier Jason Kenney announced the government would restore the practice of tying tax brackets to inflation after ending it in their first budget.

“Even with the UCP’s reversal on these tax increases, they don’t go far enough,” said Ganley.

“It only ties tax brackets to inflation starting this year and doesn’t make up for the hundreds of millions of dollars the UCP have already taken out of Albertans’ pockets through their tax on inflation. Worse yet, the UCP is refusing to reindex the Seniors Benefit, the Child and Family Benefit or AISH. This means families and vulnerable Albertans will struggle more and more each month to pay for food, housing, and cover their monthly bills.”

“But the UCP hasn’t just deindexed taxes and benefits. They’ve also increased property taxes, tuition, interest on student debt, fees for seniors’ medical exams, camping and park fees, utilities, and auto insurance. None of these UCP fee hikes were addressed in today’s update. If the UCP was serious about helping Albertans during this affordability crisis, they would reverse their tax increases and fee hikes.”

“We must also get off the resource revenue rollercoaster by diversifying our economy, but there was not a single word about diversification in the update. Not only did the UCP raise income taxes and cut benefits in their first budget, they also declared diversification a luxury and cut tax credits for emerging sectors,” said Ganley.

The full report on the 2022-23 First Quarter Fiscal Update and Economic Statement can be viewed on the Government of Alberta’s website.

(With files from rdnewsNOW)

by David Opinko/LethbridgeNewsNOW

Alberta to use $13.2 billion surplus to pay down debts

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