Is a Provincial Sales Tax far off in Alberta?
Despite our political leader’s pledge to ‘never raise taxes‘ (which was made only months after taxes were raised), I have noticed an increasing amount of talk about the merits of implementing a Provincial Sales Tax in Alberta. After the recent drop in the price of oil and natural gas over the past few years, I have encountered many Albertans who have started to talk about where our provincial government gets its revenue and how that revenue source is largely at the mercy of international commodity markets.
How would Albertans react to the introduction of a PST? In 1993, the introduction of the GST was one of the many reasons voters in this province did not support the province’s Progressive Conservative Members of Parliament (including Edmonton MP Murray Dorin, who vice-chaired the parliamentary committee responsible for the creation of the GST). In 2010, it would be fair to say that most Albertans are comfortable with and have accepted the existence of the GST.
While it is a different form of tax, for years Albertans paid Health Care Premiums that were branded as contributions to the health care system (though they were funnelled into general revenue). When the premiums were cancelled in 2008, it was largely seen as a positive move until people started to realize the billion dollar shortfall that was created.
Tax increases are considered an anathema in politics, but I would bet that a large number of Albertans would be willing to support the introduction of a PST if it meant that our province would have a more secure source of stable revenue to support public programs and infrastructure development.
Update: Alain Saffel also discussed this topic on his blog today. Alain points out that the issue of a PST in Alberta was discussed this morning by Calgary Herald columnist Deborah Yedlin and Alberta Venture editor Paul Marck on CBC’s Edmonton AM program.