If the Albertan economy fails to recover quickly under the new leadership of Premier Jason Kenney, Albertans may want to consider long and hard whether a provincial sales tax (PST) would be beneficial to cutting into the deficit.
A tax — yes I know that word is frowned upon round these parts — although occasionally inconvenient at the check-out line it could help ensure that health, education and our entire social safety net is protected from potential cuts that will be used to balance the budget.
If the UCP government hopes to fulfill their major campaign promise of kick-starting the Albertan economy first in order to help cover the costs of essential government services, they need to ensure that they do not pin all their hopes on solely increased oil and gas revenue.
This becomes ever more essential considering the many of factors of a strong oil and gas economy rely on levers outside of provincial authority.
What a PST could do is help offset the instability that comes when you are relying on multiple unstable variables like an increase of oil and gas revenues.
Obviously, opposition to any tax in this province would come full steam — but Albertans — including those who would be against a PST — are in need of new schools, new hospitals, seniors housing, improved infrastructure and many other services that would put people in peril if they are cut.
Currently, Alberta is one of four jurisdictions in Canada (The others being Nunavut, the North West Territories and the Yukon) that do not have some form of additional sales tax on top of the GST. The current highest provincial tax in Canada is Quebec at 9.975 per cent and the lowest being Saskatchewan at six per cent.
Out of all provinces currently with conservative provincial governments in power, Alberta remains the only province without some level provincial sales tax. Alberta’s ability to avoid a PST was a favourable fortune resulting from years of oil and gas investment and revenue. Without $100 barrels of oil, that favourable fortune has turned into a relic that commands a response.
Obviously, citizens and fans of Alberta want the economy to improve and an economically powerful, sustainable and environmentally-friendly model of oil and gas development would go a long way towards the success of the province, but as it stands now, we need another tool to pay for services that we cannot afford to lose.
A PST would cause grumbling at the cashier, but if it pays for hospitals in Red Deer, schools in Calgary and safe highways to Fort McMurray, I think we can all stand listening to a bit of muttering.