CCPA-NS Releases Report on Nova Scotia’s Fiscal Situation
READ THE FULL REPORT HERE.
HALIFAX — The government has the opportunity to tackle pressing problems like poverty and climate change in their upcoming budget, according to a report released today by the Canadian Centre for Policy Alternatives-Nova Scotia.
The report titled Nova Scotia’s Fiscal Situation: Reflecting on Government Priorities, Proposing Alternatives says that Nova Scotia’s debt to GDP ratio is at its lowest level since the early 1990s, and debt costs as a portion of government revenue are at their lowest levels since the 1980s.These improvements in debt management mean the government should renew its focus on its promise to make Nova Scotia “the best place in Canada to live, work, do business and raise families”, contained in its own economic development strategy.
According to CCPA-NS Director Christine Saulnier, “The province’s finances are in better shape than they have been in some time, but we now face other significant challenges. Now is the time for the government to take the kind of energy and resources that has been devoted to making our fiscal situation sustainable, and tackle issues like poverty reduction and climate change.”
Tackle Poverty by Sharing the Benefits of Economic Growth More Equitably
According to the CCPA-NS, the province has a long way to go to make Nova Scotia a better, let alone the best, place to work and raise a family. In spite of significant increases in productivity and economic growth, average wages for Nova Scotians, adjusted for inflation, are unchanged from 30 years ago. The lack of progress is even more dramatic for those families and individuals living in poverty, with more people living in homelessness than ever before.People, who don’t know whether they are going to be able to pay the bills at the end of the month, or who face food insecurity, cannot fully participate in the broader community.
The CCPA calls for funding to be allocated in this fiscal year to begin implementation of the recommendations expected from the Poverty Reduction Working Group.To pay for poverty reduction, the CCPA says new revenue should be collected from the richest 1% of the population, because they have benefitted disproportionately from economic growth and tax cuts.
The CCPA-NS proposes a 30% marginal provincial surtax on any income earned above $150,000, which corresponds approximately to the top 1% of the income distribution in Nova Scotia. This means that as a share of total income, even individuals reporting more than $250,000 would see their average tax bill increase by less than 17%.This slight change in the tax bills of those with the highest incomes, would provide $200 million to be used for social programs specifically targeted to reduce poverty.It could, for example, bring the income of Employment Support and Income Assistance recipients closer to the poverty line and provide real incentives and meaningful programs to support them to re-enter the workforce.
Prioritize Climate Change through Equitable Carbon Tax
The CCPA also says the government can prioritize global warming in its budget by implementing a carbon tax in a way that ensures an equitable sharing of the revenues collected.
The CCPA-NS recommends the immediate introduction of a $5/tonne tax in this budget, which will be increased by $5 per year to be $30/tonne by 2013.
The revenue raised from this tax will be returned to all Nova Scotians in the form of a carbon credit.The first carbon credit is estimated to be $124 for every Nova Scotian.The carbon credit approach is a more equitable alternative to income tax cuts, as it ensures the benefits of carbon tax revenue would flow to those in most need of access to energy and transportation.
Tough Decision Yes, Choices Yes
Nova Scotians know the government has tough decisions to make. What they are not always told is that the government could be making different choices that would benefit more Nova Scotians now and in the future.
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