News Release Archive
FINANCE--BILL ENACTS TAX CUTS, LONG TERM DEBT PLAN
-----------------------------------------------------------------
Lower taxes, incentives to invest in community-based economic
initiatives and a long-term plan to keep the province's budget
balanced, are all contained in legislation introduced today by
Finance Minister Bernie Boudreau.
"I believe this is the most important piece of legislation I have
sponsored in my time as Minister of Finance," Mr. Boudreau said
of the Financial Measures Act, a five-part bill that enacts last
week's provincial budget.
The bill contains the first-ever reduction in Nova Scotia's
income tax rate. The tax cut, effective July, 1997, will give
Nova Scotia the third lowest income taxes in the country, and the
lowest east of Alberta.
"Nova Scotians have waited a long time for this bill. This is the
first personal tax reduction Nova Scotians have ever seen," Mr.
Boudreau said, adding that the bill and last week's budget are
"about building a stronger economy in Nova Scotia."
The minister noted that, because it is a year away, some people
have said the tax cut is just a promise. "Well, soon it will be
the law."
Regulations enacting the enhanced low income tax reduction
announced in the budget will go to cabinet for approval next
week. That measure will provide additional tax relief to more
than 200,000 low income Nova Scotians. The net effect is many
more low income families will not pay provincial income taxes.
The bill also repeals the government's expenditure control
legislation, and replaces it with a long-term financial plan that
will allow spending on programs and services to increase, but
only as the government can afford to pay for them.
It requires governments to keep their budgets in balance, and
seek approval from the legislature to go over-budget by more than
one per cent. It prescribes that surplus funds must be used to
reduce taxes or pay down the $8.5 million debt.
The legislation will require quarterly financial reports from the
province and require Crown corporations to seek legislative
approval for their business plans and public financing. It also
contains measures to reduce the foreign currency exposure of the
province's debt.
The expanded 30 per cent equity tax credit and 20 per cent
provincial guarantee, designed to attract investment to
community-based economic initiatives, are also contained in the
bill. Investment in community economic development funds are also
expected be eligible for federal RRSP tax credits.
"Combined, these measures will allow people to invest in Nova
Scotia's future while, in effect, risking less than 10 per cent
of their original investment," the minister said. "That's why
this is among the most attractive investment opportunities in the
country."
"This bill, and the budget that gave rise to this legislation,
are about building a stronger economy and creating jobs for Nova
Scotians."
"Leaving more money in the pockets of Nova Scotians will help to
do that. So will measures like the expanded equity tax credit and
provincial guarantee. Tax changes that make our businesses more
competitive are another essential part of the package. The
harmonized sales tax achieves that goal. The new capital tax on
the largest companies in the province, and the enriched low
income tax reduction, ensure that the tax burden remains fairly
distributed and is not shifted to those who can least afford it."
-30-
Contact: Jim Vibert 902-424-4886
Donna MacDonald 902-424-8787
trp May 01, 1996 - 2:45 p.m.
