Saskatchewan finance minister Jim Reiter faces a crucial test: Balance the budget, cut taxes, control spending
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Starting a new job is always nerve-wracking, but Saskatchewan’s new finance minister is likely feeling more than just regular new job nerves.
Jim Reiter was just appointed by Premier Scott Moe to be Saskatchewan’s new finance minister. Reiter has been a minister many times in the past, but working on a specific file is different than being the person who controls the entire taxpayer piggy bank.
That’s because everyone and their dog, including Reiter’s own caucus members, will be making his phone ring off the hook with requests to spend taxpayers’ money.
His predecessor knew this. Former finance minister Donna Harpauer said she would have loved to end her time as finance minister with a balanced budget, but her colleagues pushed her to spend more.
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With a fresh new four-year government, Reiter can buck the trend and be a finance minister who consistently delivers for taxpayers. That means providing tax relief, controlling spending and balancing the budget. It also means not kowtowing to bureaucrats and their pet projects or other politicians who want to run up the taxpayer credit card.
The government hasn’t been delivering for taxpayers for a long time. Instead, it’s been giving them years of deficit spending that is increasing the debt and leading to more money being wasted on interest payments.
The government did promise some tax relief during the election. Moe promised to increase the amount of money you can make before you have to start paying taxes and promised to expand a bunch of tax credits. That’s a good start, but the government can do better and provide more tax relief to all taxpayers, not just those who fit the requirements of a tax credit.
A PST cut is a great place to start. A one percentage point cut to the PST would save a Saskatchewan family making $75,000 about $337 every year.
A PST cut would right a wrong. The provincial government hiked the PST from five to six per cent and began charging it on more items like restaurant meals and children’s clothes in 2017. Because of that hike, that average family is paying almost $300 more in PST this year than in 2017.
A sales tax cut is important because it would help everyone in the province, but especially those with lower incomes. Lower-income people have less money to buy necessities, so sales taxes are a bigger hit to their wallets than for those who are better off.
Reiter also needs to control spending. The Saskatchewan Party platform lays out a plan for the government to balance the budget in three years. Reiter needs to speed that up because taxpayers can’t afford to wait any longer.
The provincial debt will be more than $21 billion by the end of this year. That’s more than double what it was 10 years ago. Every Saskatchewanian’s share of the debt works out to about $16,780.
The government is bringing in $19.9 billion in revenue this year. That means if the government didn’t spend on anything and used every penny to pay off the debt, it wouldn’t be enough. Reiter can’t let the debt keep increasing.
The government is staring down a $353 million deficit this year, but the new finance minister only has to exercise a little fiscal restraint to defeat it. For example, if, in the last budget, the government had held the line on spending for everything except for the $1 billion increase in health and education, the government would be projecting a $331 million surplus.
Controlling the purse strings is a tough job, but the new finance minister needs to take it in stride. Instead of listening to bureaucrats who want the government to empty the taxpayer piggy bank, Reiter needs to deliver for taxpayers with more tax relief and a balanced budget.
Gage Haubrich is the Prairie Director for the Canadian Taxpayers Federation.
Explore more on Saskatchewan politics, Saskatchewan debt and deficit, Saskatchewan taxes, Moe government, Saskatchewan budget
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