TAX REFORM HIGHLIGHTS
A simple, three rate "tax-on-income" structure will be introduced January 1, 2001. Lower income tax rates and higher personal tax credits will be phased in over three years.
When fully implemented in 2003, tax reform will mean: an average family of four will save about $1,000 a year in total taxes; about 70 per cent of Saskatchewan people will pay the same income tax rate as Albertans; and 55,500 low income Saskatchewan residents will no longer pay provincial income taxes.
By 2003, the new "tax-on-income" rates will be lowered to: 11 per cent on taxable income up to $35,000; 13 per cent on taxable income between $35,000 and $100,000; and 15 per cent on taxable income over $100,000.
Saskatchewan residents will also qualify for: a basic tax credit of $8,000; a spousal or equivalent-to-spouse tax credit of $8,000; a child tax credit of $2,500 for each dependent child; and a $1,000 supplement to the existing senior's tax credit.
Taxable capital gains of farmers and small business owners will be taxed at the lowest provincial income tax rate beginning in 2001.
To make the system fair for low income earners, a new Saskatchewan Sales Tax
Credit will be introduced effective April 1, 2000. The new credit will provide a tax rebate to lower income families of up to $264 a year, with all families earning up to $35,000 receiving benefits.
The sales tax rate will remain at six per cent, the lowest rate in Canada, but effective midnight Budget night, will be expanded to items taxed in other provinces. Family necessities such as home heating, electricity, prescription drugs and children's clothing will not be subject to provincial sales tax. Restaurant meals will continue to be exempt.
As part of this reform, effective midnight, Budget night, the provincial sales tax will apply to purchases made off reserve by First Nations people.
The reform of Saskatchewan's income and sales taxes will provide provincial residents with an overall tax reduction of about $260 million when fully implemented. This tax cut includes a $440 million reduction in Saskatchewan's income taxes, the largest income tax reduction in the province's history.
For 2000, taxpayers will see the Saskatchewan flat tax reduced from two per cent to one per cent beginning July 1, 2000.
The remaining reforms to the income tax system will begin on January 1, 2001, and be fully implemented January 1, 2003.
Saskatchewan's health care system will receive an additional $63 million in
base funding and $150 million for a Health Transition Fund to make the system
sustainable in the years ahead.
The Minister of Health will soon announce a process to develop a plan for
sustainable and effective health care for the 21st century.
Farmers will pay no farm fuel tax and will receive a two year property tax
rebate: a two year program worth $25 million a year will rebate property tax
on farmland; and the limit on the gasoline tax rebate has been removed - there will be no tax
on farm fuel.
A record $250 million will be invested in highway construction and maintenance
this year - an increase of $15.4 million over last year, and of almost $82
million from 1995/96.
EDUCATION AND RESEARCH HIGHLIGHTS
$18.5 million more for school boards and $29.2 million for K-12 education
$27 million for post-secondary education and skills training - up six per
A $350 income tax benefit for post-secondary graduates who start work in
A new $10 million Innovation and Science Fund that will attract an investment
pool of up to $100 million over four years.
CENTENARY CAPITAL FUND
A new $120 million Centenary Capital Fund has been created to prepare
Saskatchewan for its second century.
It will provide support for important projects related to schools,
universities, SIAST and regional colleges, municipal infrastructure, roads,
highways, environmental clean-up, social housing, parks and heritage
properties. Five million dollars a year will go to support critical
infrastructure needs in the North.
The 2000-01 Budget is the seventh consecutive balanced budget. The total
provincial debt will be just over $11 billion or 38 per cent of gross domestic
product (GDP) at March 31, 2000, falling to 31 per cent of GDP by 2004.
BUDGET TAX AMENDMENTS (2000)
The following is a list of Education and Health Tax, Tobacco Tax, Fuel Tax and Insurance Premium Tax bulletins that have been prepared, or revised, to help explain tax changes announced in the March 29, 2000 budget:
|General||Summary of Changes to E&H Tax announced in March 29, 2000 Budget|
|EH-1||Clothing and Footware|
|EH-2||Grocery and Drug Stores|
|EH-6||Extended Warranty and Maintenance Contracts|
|EH-7||Suppliers of Computer Hardware, Software & Computer Services|
|EH-9||Books & Magazines|
|EH-11||Ready to Move Home Builders|
|EH-13||Oil & Gas Contractors|
|EH-14||Oil and Gas Producers|
|EH-15||Service Stations and Automotive Repair Shops|
|EH-17||Information for Hardware and Business Supply Stores|
|EH-18||Motor Dealers & Licensing Companies|
|EH-23||Florists & Garden Centers|
|EH-25||Video Producers, Photographers & Photo Finishers|
|EH-27||Boards of Education|
|EH-31||Tourist Outfitters & Vacation Farms|
|EH-32||Antiques, Stamps, Coins & Paper Money|
|EH-41||Cities, Towns and Municipalities|
|EH-42||Medical Equipment & Supplies|
|EH-43||Industrial & Construction Equipment Dealers & Suppliers|
|EH-47||Vendors Providing Lodging|
|EH-48||Recreation Vehicle Dealers|
|EH-49||Non-Resident Vendors Supplying and Installing Tangible Personal Property|
|EH-53||Launderers and Drycleaners|
|EH-54||Security & Investigation Services|
|EH-55||Credit Reporting Agencies & Collection Agencies|
|EH-57||Businesses Providing Repair Services|
|EH-58||Taxation of Used Goods|
|EH-60||Transfers of Business Assets|
|LCT-1||Liquor Consumption Tax|
|FT-6||Fuel Tax Collectors|
|TT-2||Tobacco Tax Rate Changes|
|Insurance||Insurance Premiums Tax Act|