CALGARY– In its latest budget, the Manitoba government focuses on reducing the deficit by increasing the provincial sales tax and containing some spending, but makes little progress on longer-term objectives.

“It is always difficult for governments to focus on what is needed for long-term prosperity and this is especially true when dealing with challenges like major flooding and ongoing deficits,” notes Dylan Jones, President and CEO. “While this budget puts Manitoba closer to balancing its books and does have some positive elements to enhance economic participation of all citizens, we will have to wait for future budgets to see an aggressive long-term strategy for Manitoba’s prosperity.”

The Canada West Foundation’s 2013-14 Manitoba Budget Analysis reveals a budget that:

  • makes an effort to reduce the deficit while increasing spending on health, education and family services;
  • takes measures to increase education, skills and workforce participation, which could be successful if pursued aggressively and if prolonged federal-provincial negotiations can be avoided; and
  • produces mixed results on business tax competitiveness.

“Capital taxes provide a disincentive to businesses to reinvest in expanding their operations,” states Michael Holden, Senior Economist. “The revenue generated by the increased capital tax on financial institutions will harm the economy.”

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