Follow local budget plans closely
THE proposed provincial and City of Winnipeg budgets were recently released, each praised in some circles and criticized in others.
The provincial budget was a deficit budget, and the government is in fact projecting deficits until 2014. That’s a long time, and media editorials have warned that this could delay or eliminate new programs such as tax cuts while requiring increased user fees. Winnipeg city council approved an operating budget on March 23 that once again froze property taxes.
It’s been suggested both budgets are election budgets, with a city vote this October and provincial elections a year later.
Given the inevitability of increased fees and budget deficits, it’s interesting to look at what’s going on in other jurisdictions and draw comparisons.
The U.S. still has a very long road to recovery. The dollar has been falling steadily over the past few months and some are calling for it to stay at its current rate for an extended period. Employment is likely to be the key to their recovery.
B.C. and Ontario will be implementing the Harmonized Sales Tax effective July 1. The entire country is anxiously watching to see the economic impact on theses provinces and the rest of Canada. Home ownership costs are definitely going to increase. In Nova Scotia, the government which has been in office less than one year is already considering increasing its HST by two per cent.
The federal budget plans to cut back the deficit by reducing spending and supporting economic growth, while not raising taxes. Finance Minister Jim Flaherty expressed confidence in the housing market, refusing to implement some suggestions that would make owning a new home more onerous.
Unfortunately, the popular Home Renovation Tax Credit will not be continued. Bank of Canada governor Mark Carney has called for a modest increase in interest rates in the near future with a ‘wait-and-see’ attitude regarding another increase in the fall.
So, we’re all well advised to follow our local budget plans very closely. We can learn a great deal from neighbouring cities and provinces, both good and bad. Sometimes, slow and steady allows us to learn from the mistakes of others before rushing in to be first in line.