The Prince Edward Island government introduced its budget, with no tax increases (including tobacco taxes) but no corporate or Harmonized Sales Tax (HST) relief.
The government has virtually held the line in program expenditures while increasing capital spending by 7.1% to $1.06 billion.
Gross Domestic Product for 2013 rose by 1.5% last year and is projected to keep the same pace for 2014.
The province is facing a $51.9 million deficit for the 2013-14 fiscal-year, while projecting a $39.7 million deficit for 2014-15. The government is projecting a small budget surplus for 2015-2016. This would mean that PEI will have gone almost a decade between balanced budgets.
The majority of the spending increases will be in Health and Education.
The government has committed to Red Tape reduction sector roundtables in an effort to identify government regulations and processes which inhibit business success.
In its pre-budget submission, Retail Council of Canada (RCC) continued its call for corporate and HST tax relief as well as a reduction in red tape.
While disappointed with the lack of tax relief, RCC understands that the government should first focus its efforts on achieving a balanced budget. Prince Edward Island will remain among the highest taxed provinces in the country.
The province’s own source revenue is projected to increase 3.2% in 2014-15 to $924,046,300.
The province’s labour force is up 2.1% with the third highest labour force participation rate in the country at 69.3%
The tourism sector had a 35.7% increase in cruise ship traffic and a motor coach increase of 29.6% while car, ferry and air traffic decreased.
The province’s HST revenues are forecasted to decrease in 2014-15 by 0.3%, taking in an estimated total of $250,324,100.
RCC is encouraged with the commitment to launch Red Tape reduction sector roundtables but will reserve judgment until details of the roundtables are provided.
New Budget initiatives include:
Funding to help children and families: insulin pumps and related supplies for children with Type 1 diabetes, free eye exams and glasses for eligible kindergarten children; the Triple P (Positive Parenting Program) to help provide proven parenting solutions; a further 2% increase in room and board and clothing allowance for children-in-care (aka: foster care families).
Regulations will be changed to allow pharmacists to directly deliver the flu vaccine.
A new home care renovation program ($1.2 million) will be implemented and the grant amount for the Senior’s Home Repair Program will be increased.
The Island Community Fund has been extended to 2014-15 with a budget of approximately $2.3 million. This fund is used to provide upgrades to community rinks, fire departments, community centres, etc.
If you have any questions or concerns, please don’t hesitate to contact: Jim Cormier, Director (Atlantic) at: [email protected] or 902-422-4144