It’s a little thing like walking up a flight of stairs without wheezing that makes going to the gym feel like a good decision.

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This article was published 6/9/2019 (993 days ago), so information in it may no longer be current.

Opinion

It’s a little thing like walking up a flight of stairs without wheezing that makes going to the gym feel like a good decision.

The Progressive Conservative election platform is clearly crafted to offer voters that kind of moment to taxpayers. PC Leader Brian Pallister is promising Manitoba taxpayers a package of tax cuts. And a big reason he’s able to do that is because he’s planning to keep a tight grip on spending and projecting to balance the operational budget ahead of schedule.

Some context is important.

After years of borrowing, the provincial debt is now nearly $25.6 billion. It’s going up by about $1,700 per minute. Worse, the province is projected to pay about a billion dollars to cover the interest on the debt this year. That money will go to Bay Street bankers instead of Manitobans.

These deficits haven’t happened because taxpayers haven’t paid enough. A Winnipeg family with an income of $75,000 pays about $7,580 in provincial taxes, compared to a Regina family that would pay $4,605 or a Toronto family that would pay $5,628.

This combination of high debt and high taxes is a real problem. When Pallister became premier, his plan boiled down to two steps: fix the finances and cut taxes. And now he’s promising to extend that plan.

Pallister says he’ll balance the operational budget in 2022-23. Right now, the deficit is $360 million — that’s about half a billion dollars less than the budget hole he inherited. Pallister made that progress despite increasing spending to $17.4 billion from $15.5 billion projected in the NDP’s last budget. By controlling spending, Pallister can make sure less money is diverted to debt interest charges.

Now Pallister is offering taxpayers the benefits of that prudence.

The biggest benefit is already in place: the one-point PST cut. It’s saving taxpayers about $325 million per year. Pallister is building on that by taking the PST off of everything from home insurance to haircuts. Now he’s tackling a big tax project.

Pallister is promising to cut education property taxes by 10 per cent after the budget is balanced, and he’s promising to keep cutting until education property taxes are completely eliminated. When the process is complete, the party says it’ll save the average Winnipeg homeowner about $2,000 annually.

The elimination of the education property tax is a long-overdue policy. Keystone Agricultural Producers are particularly enthusiastic about the promise, for good reason. Farmers often pay huge property tax bills on their land, but their kids don’t get any more education than anyone else. Education property taxes are as outdated as one-room schools.

There are always legions of devils in the details required to eliminate a major tax. In particular, governments are often prone to cut one tax and replace it with another. When asked whether a re-elected PC government will raise other taxes to pay for the education property tax cut, the response was unequivocal.

"Absolutely not," Finance Minister Scott Fielding answered. "Manitobans are already taxed to the max. We’re not looking at any other taxes to fill the hole."

Add it all up, and Pallister promises to save the average taxpayer about $2,000 over the span of a second mandate.

The opposition NDP has focused on spending announcements rather than tax cuts. It’s offering Manitoba Hydro bill rebates, but there’s a catch: the money would come from a carbon tax, so taxpayers will be lucky to break even. The NDP is also offering a $1,000 discount on land-transfer taxes for first-time homebuyers and people with disabilities. For Manitobans who desperately need tax relief, those are slim pickings.

Financial responsibility is hard. It’s easier for governments to spend a little more, borrow a little more and tax a little more. Pallister is offering a harder but better way, with restrained spending that will keep interest payments from ballooning. And Manitobans, not Bay Street bankers, can reap the benefits.

Todd MacKay is prairie director of the Canadian Taxpayers Federation.