Manitoba pre-election budget offers tax cuts, higher spending
WINNIPEG — Manitoba’s Progressive Conservative government is loosening its purse strings and promising what it calls record income tax cuts in its last budget before a provincial election.
The fiscal plan put forward Tuesday, with almost $2 billion in new spending, is a marked departure for the governing Tories after several years of fiscal restraint.
"Unlike the budgets of my predecessors where fiscal responsibility ruled the day, Budget 2023 fully reflects the Progressive Conservative roots of our premier (Heather Stefanson)," Finance Minister Cliff Cullen, who was named to the post earlier this year, said in his prepared budget speech.
"This year’s budget provides help when it is most needed. It provides historic help for Manitobans."
The fiscal plan boosts spending on health care, social services and other areas by an average of close to 10 per cent. Among many new measures in health care, the government is expanding coverage of insulin pumps to all adults with a Type 1 or Type 2 diabetes diagnosis. Until now, coverage has been limited to people aged 18 to 25.
Personal and business taxes are also being cut under the budget, although much of them are promised for after the election.
This year, the basic personal exemption — the threshold at which individuals start to pay income tax — will rise to $15,000 from $10,145. The change will save people up to $524.
Next year, personal income tax brackets are to be moved higher. The middle bracket would rise to $47,000 from $36,842, and the top bracket would move to $100,000 from $79,625.
The threshold at which employers are charged a tax on their payroll is also to increase next year, to $2.25 million from $2 million. The rate of the payroll tax may also be reduced next year if provincial revenues are higher than expected, Cullen said.
The governing Tories have been trailing the Opposition New Democrats in opinion polls for more than two years. The numbers did not move even after Stefanson replaced Brian Pallister as premier in 2021.
The drop in support started during the second wave of the COVID-19 pandemic as hospitals struggled to handle a surge of patients. At one point, dozens of intensive care patients were flown to other provinces due to a bed shortage.
"Our No. 1 priority following the pandemic has been addressing the shortage of nurses and other health-care professionals in Manitoba," Cullen said.
The budget includes previously announced funding aimed at reducing wait times and easing surgery backlogs.
The government can afford the new spending and tax cuts thanks to a rebounding economy and increased federal transfer payments, Cullen said.
Federal equalization payments, which help poorer provinces offer services similar to richer ones, are up by 19 per cent — or $577 million — this year in Manitoba.
This report by The Canadian Press was first published March 7, 2023.
Steve Lambert, The Canadian Press