Manitoba analyzed sales tax hike before election

Greg Selinger admits his government analyzed a potential PST hike before the 2011 election.
Greg Selinger admits his government analyzed a potential PST hike before the 2011 election. John Woods / The Canadian Press

WINNIPEG – The Manitoba government ran the numbers on a sales tax increase before the 2011 election — a campaign in which it promised not to raise the PST — but did not seriously consider it, Premier Greg Selinger said Friday.

“It’s standard practice for finance officials to look at a variety of scenarios every year,” Selinger said.

“Officials always put forward scenarios. Usually they are batted down, which they were in this case.”

Selinger was responding to newly released Finance Department documents, obtained by the Opposition Progressive Conservatives under freedom-of-information legislation, that show there were analyses done on a possible sales tax hike in 2008, 2009 and 2010.

The Tories say the documents prove Selinger was lying on the campaign trail in 2011, when he denied Tory accusations that he was planning a sales tax hike. Eighteen months later, in the 2013 budget, the government raised the sales tax to eight per cent from seven.

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“They were discussing it. There is clear evidence that they were,” Tory Leader Brian Pallister said.

“They went ahead to the people of Manitoba and said it was nonsense to suggest that they would raise (the tax) and then they raised it.”

Selinger said finance officials weigh in on all sorts of taxes and levies, primarily to analyze how much money might be raised, and give the numbers to the finance minister of the day. But NDP finance ministers never brought the idea of a sales tax hike to cabinet until 2013, he added.

Even in 2013, it was weeks before the budget that the province decided a tax increase was needed to help pay for flood repairs, Selinger said.

“We saw a major priority needed for infrastructure investment in Manitoba, and that was part of the decision-making.”

The NDP’s popularity has plummeted since the tax went up, according to opinion polls. Selinger said there are no plans to raise the tax further.

“I think it’s pretty clear that people do not want to see any more increases in the sales tax.”