HST, gasoline and income taxes all jump in N.L. budget
‘Revenue actions’ will lighten wallets and increase costs to taxpayers
The Newfoundland and Labrador budget will make it more expensive to be born, more expensive to die, and more expensive to do pretty much everything in between.
There are significant hikes to the HST, income tax rates and the gas tax in the provincial budget brought down Thursday.
There's nothing about increasing revenue that is pleasant.- Finance Minister Cathy Bennett
If you are a single person making between $70,000 and $80,000 a year, provincial officials estimate that the combined impact of those changes alone will take roughly $2,800 out of your pocket.
And that doesn't include the consequences of an array of other fee increases and "revenue actions" to bolster the sagging provincial treasury.
"There's nothing about increasing revenue that is pleasant," Finance Minister Cathy Bennett told reporters.
Big hikes to income tax
Income taxes are going up in two stages this year and next, rolling back reductions that were put in place when oil cash was flowing and times were good.
By 2017, the lowest income earners in the province will see a one-per-cent income tax hike. The hit to the highest bracket will be an additional three per cent.
On top of those income tax increases is a "temporary deficit reduction levy." It will be effective July 1.
Those making $25,000 will be subject to an extra charge of $300 per year. If you make $50,000, the levy is $600. At $75,000 it jumps to $750. For the biggest earners, it tops out at $900.
The province hopes to begin reducing that levy in 2018.
Temporary doubling of gas tax
While their wallets will be lighter, taxpayers will be facing heavier costs to get around.
Effective June 2, there will be a temporary 16.5 cent per litre increase in provincial gasoline taxes. That's double the current rate.
If your family sedan's 50-litre gas tank cost $50 to fill today, it will soon cost $58.25 to top up the same tank.
That measure will be reviewed by the fall.
HST promise scrapped
The fledgling Liberal government also reversed a long-standing promise not to increase the HST.
The previous Tory administration had announced plans to increase the HST, but was turfed from office before the increase could be implemented.
In December, Premier Dwight Ball stopped that hike from happening, in one of his first acts after taking office.
Just months later, his government is now walking back that reversal.
The HST is going up to 15 per cent from the current 13 per cent, effective July 1.
350 fees hiked or introduced
About 300 fees for licences, permits, fines and inspections are going up. Another 50 new fees are being introduced.
Those increases will affect all phases of life. Birth certificates will cost more. So will death certificates. And marriage licences.
It will cost more to be mobile — in addition to increases to fill your gas tank, you will also pay more to register your car, get a driver's licence, ride a ferry or even fuel an airplane.
It will cost more to camp at a provincial park, to see a show at the Arts and Culture Centre, or to go salmon fishing.
In another significant move, a 15-per-cent tax will be reapplied to insurance premiums. Your $1,000 insurance policy will cost $150 more after July 1.
Corporate taxes are going up as well, a one-point jump retroactive back to Jan. 1.
While booze prices have already increased, the other sin-tax standby is also on the rise, effective Friday.
Each cigarette will cost one cent more, and each gram of fine-cut tobacco two cents more.
Big deficit still forecast
Even with all of those new measures to raise hundreds of millions in additional cash for the treasury, the province is still forecasting a tide of red ink over the books this fiscal year.
The projected deficit is $1.83 billion. Bennett said that number would have ballooned to $2.7 billion, if no action had been taken.
Last year's deficit is expected to come in at $2.2 billion.
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