Opposition, labour group call for tax reform in N.S. amid rising cost of living
Nova Scotia's Opposition and a major labour group in the province are calling for tax reform so that workers can keep more money in their pockets as they struggle with the rising cost of living.
The Nova Scotia Liberals and an Independent member of the legislature have each introduced bills to automatically adjust provincial income tax brackets to annual inflation. Tax-bracket indexing ensures that pay raises equal to the annual rise in the cost of living don't bump taxpayers into higher income tax brackets.
Indexing is in place at the federal level and in every province except Nova Scotia and Prince Edward Island.
Premier Tim Houston, however, has rejected those calls, saying there will be no major tax reform until health care is "fixed."
"There's a lot of work to be done in health care, there will be no changes to the tax structure until we've moved the needle on health care in a significant way," Houston said last week after tabling his government's second budget.
Houston's comments show that the government is "looking at things backwards," said Independent member Elizabeth Smith-McCrossin, who tabled one of the tax-indexing bills. In an interview Tuesday, she said income levels are a top determinant of people's health.
Nova Scotia Liberal Leader Zach Churchill agreed, and said in an interview Tuesday, "when people can't afford to put healthy food on the table or are stressed out about their finances, people get sicker."
The province's $14.4-billion budget allocates $6.5 billion toward health. A Finance Department official said indexing tax brackets would have deprived the government of about $125 million in revenue.
Nova Scotia NDP Leader Claudia Chender said that figure represents a fraction of the province's budget but is "a really meaningful (amount) to the people for whom it could be in their pockets."
Chender said the province's failure to index tax brackets or raise income assistance rates shows that the government "doesn't seem to grasp the severity of the cost-of-living crisis that people are living in."
Smith-McCrossin said that neglecting to index tax brackets for inflation is especially harmful to the lowest-income Nova Scotians because the province has a low basic personal income exemption level. In 2022, Nova Scotia permitted the least amount of income to be free from taxation compared to other provinces. Alberta had the highest exemption level that year, allowing residents to earn up to $19,369 free from provincial income tax.
Smith-McCrossin's bill proposed raising the basic income exemption level to $12,510.
"By choosing not to index or raise basic personal tax exemption, I believe the government is actually purposely keeping people in poverty," Smith-McCrossin said.
Danny Cavanagh, president of the Nova Scotia Federation of Labour, says he is in favour of tax indexing because low and middle-income workers are struggling with the rising cost of food, fuel and housing.
"People are just trying to survive day by day and it's becoming more and more difficult, especially for low-income earners and middle-class people," he said.
Cavanagh said, however, that indexing should be an interim measure and that Nova Scotia is due for significant tax reform that would place a higher tax burden on the wealthiest.
This report by The Canadian Press was first published March 28, 2023.
This story was produced with the financial assistance of the Meta and Canadian Press News Fellowship.
CTVNews.ca Top Stories
B.C. tenants evicted for landlord's use after refusing large rent increase to take over neighbouring suite
Ashley Dickey and her mother rented part of the same Coquitlam duplex in three different decades under three different landlords.
Mountain guide dies after falling into a crevasse in Banff National Park
A man who fell into a crevasse while leading a backcountry ski group deep in the Canadian Rockies has died.
Expert warns of food consumption habits amid rising prices
A new survey by Dalhousie University's Agri-Food Analytics Lab asked Canadians about their food consumption habits amid rising prices.
MPP Sarah Jama asked to leave Ontario legislature for wearing keffiyeh
MPP Sarah Jama was asked to leave the Legislative Assembly of Ontario by House Speaker Ted Arnott on Thursday for wearing a keffiyeh, a garment which has been banned at Queen’s Park.
Charlie Woods, son of Tiger, shoots 81 in U.S. Open qualifier
Charlie Woods failed to advance in a U.S. Open local qualifying event Thursday, shooting a 9-over 81 at Legacy Golf & Tennis Club.
Ex-tabloid publisher testifies he scooped up possibly damaging tales to shield his old friend Trump
As Donald Trump was running for president in 2016, his old friend at the National Enquirer was scooping up potentially damaging stories about the candidate and paying out tens of thousands of dollars to keep them from the public eye.
Here's why provinces aren't following Saskatchewan's lead on the carbon tax home heating fight
After Prime Minister Justin Trudeau said the federal government would still send Canada Carbon Rebate cheques to Saskatchewan residents, despite Saskatchewan Premier Scott Moe's decision to stop collecting the carbon tax on natural gas or home heating, questions were raised about whether other provinces would follow suit. CTV News reached out across the country and here's what we found out.
Montreal actress calls Weinstein ruling 'discouraging' but not surprising
A Montreal actress, who has previously detailed incidents she had with disgraced Hollywood producer Harvey Weinstein, says a New York Court of Appeals decision overturning his 2020 rape conviction is 'discouraging' but not surprising.
Caleb Williams, Jayden Daniels and Drake Maye make it four NFL drafts with quarterbacks going 1-3
Caleb Williams is heading to the Windy City, aiming to become the franchise quarterback Chicago has sought for decades.