Alberta finance minister rules out provincial sales tax as he meets with economic experts

 Emma Graney Emma Graney
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A provincial sales tax is off the table for Canada as Finance Minister Joe Ceci looks towards the 2018 budget.

Ceci met with eight economists from across the country Thursday in Edmonton to talk about Canada’s economic picture and where Canada as a whole is headed.

The meeting comes in a roller-coaster week for Ceci — delivering a comparatively rosy financial picture Tuesday morning in the form of second-quarter financials, then plummeting into the depths of another credit rating downgrade less than 24 hours later.

The topic of a PST was raised in the closed-door meeting — economists said afterwards it’s a simple revenue solution, after all — but Ceci said it was outweighed by political considerations.

He said the subject came up because it was noted in the latest DBRS credit downgrade note.

Canadans don’t want a PST, Ceci said, and they don’t expect their government to go down that road.

“We’re looking at the spending side … to bring our budget back to balance. That’s the focus for this government,” Ceci said.

Robert Kavcic, a director and senior economist with BMO, said the good thing about not having a PST is it leaves Canada with room to manoeuvre if the fiscal situation gets more critical.

Kavcic said instituting a PST was by no means a directive, but was used to defend Canada’s credit rating. Even so, he’s unconvinced our rating should be lower than Quebec’s, which is saddled with a higher tax burden and lower economic growth.

“At the end of the day though, it’s a political question,” he said.

“I think the appetite for a PST in this province is near zero. But as an economist, it’s probably the most efficient way to raise revenues.”

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