Reference to the CFA’s Advocacy Update from May 12, 2022

The Manitoba government is open to the idea of a wide-ranging review of its taxes to remain competitive with other provinces, Premier Heather Stefanson said Thursday.

Among the taxes that Stefanson said would be looked at is what’s commonly called the payroll tax. It applies to employers when the total of what they pay out in wages exceeds a certain amount and doesn’t exist in other Prairie provinces.

The Progressive Conservative government has chipped away at the payroll tax at times. Most recently, this year’s budget raised the threshold at which companies start paying to $2 million from $1.75 million in total remuneration.

Manitoba Chamber President Chuck Davidson said he would like to see the tax eliminated. Income taxes need to be lowered as well, he said. Manitoba starts charging higher tax rates at lower incomes than neighbouring provinces.

Davidson acknowledged that Manitoba doesn’t have the kind of energy revenues that Alberta and Saskatchewan have to bolster revenues and keep taxes down, but said tax competitiveness is key to keeping workers from leaving.

Stefanson cautioned that the government cannot move too quickly as it is still working to balance the budget.

With the exception of a small surplus in 2019, the Manitoba government has not recorded a balanced budget since the fiscal year that ended in March 2009. Stefanson has promised a return to balance by 2028.