Nova Scotia forecasts $98M deficit, will slash film tax credit next year

HALIFAX – The Nova Scotia government is forecasting a deficit of $97.6 million for 2015-16 that largely holds the line on spending while revamping some departments and tax measures including a film tax credit.

Overall departmental spending is $8.9 billion, up a scant 0.7 per cent over last year, which is mainly due to public sector wage increases.

The budget maintains a $24 million annual film tax credit for this year but restructures it.

But the government says the credit will be reduced to $6 million next year, a move it concedes will make the province less competitive with most other jurisdictions.

The government has also issued 163 layoff notices due to a reorganization of departments including the elimination of the Department of Economic and Rural Development and Tourism.

Highlights of the 2015-16 Nova Scotia budget introduced Thursday:

– Deficit of $97.6 million is projected in a $10-billion budget, with net debt reaching $15.1 billion in this fiscal year.

– A $24 million film tax credit is maintained for this year, but the amount of money available is cut in 2016.

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– Tobacco taxes increase by two cents a cigarette, effective at midnight Wednesday.

– The civil service will see the elimination of the equivalent of 320 full-time jobs, mainly through attrition and vacancies.

– Another $2 million will be spent to pay for 450 more orthopedic surgeries, while $700,000 will go to expand the sexual assault nurse examiner program to two more areas.

– University operating grants go up by one per cent or $3.2 million and schools will be allowed a one time market adjustment to tuitions before the current three-per-cent cap on tuition increases is maintained again.

– The cap on university tuition increases is eliminated for out-of-province and graduate students.

(The Canadian Press)

Watch: Ron Krostein interviews Provincial Finance Minister Diana Whalen.