As former Progressive Conservative finance ministers battle over the merits of introducing a provincial sales tax, a new poll shows bedrock opposition to a PST among Albertans.
An opinion poll by ThinkHQ Public Affairs finds 72 per cent of Albertans surveyed would vote against introducing a provincial sales tax if the idea was brought forward in a referendum.
17 per cent said they would back a PST, nine per cent were unsure and two per cent wouldn’t vote.
“It’s overwhelming,” pollster Marc Henry said in an interview Wednesday.
“From a political perspective, bringing in a sales tax would be the end of the Conservatives in Alberta.”
Under the Alberta Taxpayer Protection Act, the province must hold a referendum before introducing a sales tax.
In the poll, 73 per cent of respondents rejected repealing legislation that requires a sales tax vote, while 20 per cent would approve of the idea.
“The thing that’s unique about Alberta is that we’ve never had (a sales tax) and, No. 2, we actually have the requirement from 1995 on that the decision will be made by voters, which makes it sort of a double hurdle,” Henry added.
The online survey of 1,214 Albertans was conducted Feb. 12-16, and has a reported margin of error of plus or minus 2.8 percentage points.
The idea of a provincial sales tax has been boiling in Alberta for months as Premier Alison Redford’s government faces a $4-billion deficit for the 2012-13 fiscal year.
It is also grappling with a $6-billion revenue shortfall in next month’s budget due to lower-than-expected bitumen prices.
On Wednesday, former finance minister Ted Morton – known as a staunch fiscal conservative within the Tory ranks – called for the government to fix its financial problems by rolling back civil service wages and by introducing a provincial sales tax.
But two former finance ministers in the Klein government – Stockwell Day and Pat Nelson – urged the Alberta government not to adopt a PST and instead take a closer look at what services the government should provide.
Day, provincial treasurer from 1997 until 2000, said keeping taxes low attracts more jobs and investment to a province, and brings in more tax dollars in the long run.
“The government that brings in a provincial sales tax in Alberta without getting rid of the provincial income tax – that will be one of the last acts of that government,” he said in an interview.
“You would go down in the history as being a courageous loser.”
The former federal cabinet minister noted when he was Alberta’s treasurer, there were quiet discussions about cutting income taxes and replacing them with some sort of consumption tax. But simply introducing a PST to fix the province’s current financial woes would be wrong, he added.
Nelson, provincial treasurer from 2001 until 2004, agreed the focus should not be on raising more revenue for government, particularly through a PST.
“I think it would absolutely be the wrong move to make,” said Nelson, finance minister when the Alberta government retired its debt in 2004.
“We have to look at what we’re doing and focus on getting our fiscal house in order – and that doesn’t include raising taxes.”
Morton isn’t alone in his interest in a PST, however. Former finance minister Ron Liepert – the architect of the current budget – has suggested the government should consider all options and not paint itself into a corner by ruling out future tax hikes.
At the Alberta Economic Summit in Calgary this month, several business leaders and economists said a provincial sales tax would be the most efficient way to raise additional revenue and fix the province’s overreliance on unstable resource royalties.
According to the Finance Department’s website, a five per cent sales tax at the cash register – matching the rate in Saskatchewan – would generate between $5 billion and $6 billion annually for the province.
In Grande Prairie on Wednesday evening, Redford said she doesn’t believe Alberta needs a PST.
“We are not raising taxes. We are not putting a provincial sales tax in place,” she told reporters before a speech.
Alberta Finance Minister Doug Horner said Wednesday it’s interesting that people are debating the idea of a PST, but “I’m proud of the fact we don’t have a provincial sales tax.”
Horner said the government won’t repeal the legislation requiring a referendum to implement a sales tax and there is no plan – even in the long-term – to bring in a consumption tax.
“Until I’m told otherwise, my budget, my three-year business plan, in fact my five-year projection, is based on not doing it,” he said.
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