“Our party was elected to keep building Alberta — to focus our spending on the priorities that you told me were important, and that is exactly what
we’ll do.” – Premier Alison Redford in an email to Progressive Conservative Party supporters on January 23, 2013

Premier Alison Redford will star in a pre-recorded television message tonight following the 6pm news hour on CTV in Calgary and Edmonton. The Premier is expected to use the 8-minute address as part of the government’s ongoing exercise of managing public expectations about the upcoming provincial budget.

The budget is expected to include a projected $3 billion deficit, largely influenced by a lower price of oil than  including a drop in the price of oil. The promise of “no new taxes, no service cuts” has put Alberta’s Tories in an unenviable political bind and set the tone for this year’s provincial budget debate.

Despite the cries of fiscal hawks wanting to slash and burn the province’s public services, as I wrote earlier this month, Alberta’s revenue problem has already become the defining issue the 2013 budget debate.

Raising the levels of natural resources royalties or reasonably increasing taxes are not issues the Premier is expected to touch on during tonight’s television appearance, but raising taxes is an issue that a handful of former politicians have recently delved into. Former Premier Ed Stelmach, former Finance Minister Shirley McClellan, former Deputy Prime Minister Anne McLellan, and former provincial Liberal leader Kevin Taft tackled the tax dilemma facing Alberta’s finances last weekend at the University of Alberta.

According to economist Bob Ascah, who was at the weekend event, a one-per cent sales tax could raise $750 million in revenue for the province.

And as reported on David Climenhaga‘s Alberta Diary Blog, Glen Hodgson, the chief economist of the Conference Board of Canada has also weighed in on Alberta’s tax dilemma:

“Not having a provincial consumption or sales tax is highly popular and has been great politics, but it denies the provincial government a steady and stable source of revenue through the business cycle.”