CALGARY, Alberta, March 14, 2019 (GLOBE NEWSWIRE) -- The Alberta government could balance its budget by 2021/22—and create the fiscal room for much-needed tax relief—if program spending were cut by 10.9 per cent over the next three years, finds a new study released today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.
“Eliminating the deficit quickly and pursuing tax reform to regain the province’s former tax advantage across North America should be a priority for the Alberta government,” said Ben Eisen, Fraser Institute senior fellow and co-author of A Spending Framework for Alberta: Balancing the Need for Deficit Elimination and Tax Reform.
The study finds that a nominal spending reduction of 10.9 per cent over the next three years would not only balance the budget by 2021/22, but it would also create enough fiscal room to allow for personal and business income tax relief, carbon tax relief, and capital gains tax relief.
While a 10.9 per cent spending reduction would be significant, it is substantially smaller than the reductions implemented by the Klein government in the 1990s. It would also bring Alberta’s per-person spending closer into line with neighbouring British Columbia, which currently spends 21 per cent less per person than Alberta does.
“Given Alberta’s dire economic situation, its fiscal policy needs to be focused on creating the conditions for prosperity, which means eliminating the deficit but also, importantly, regaining competitiveness to attract entrepreneurs, investors, and business owners,” Eisen said.
This study is part of a new book Alberta Prosperity: A Plan for Opportunity and Growth, which explores policy reforms in Alberta’s finances, the health-care and education systems, the investment climate and resource regulation, among others.
“Alberta no longer leads in several critical policy areas, which is a marked departure from just 10 years ago,” said Jason Clemens, executive vice-president of the Fraser Institute.
“This new book provides policymakers with a clear plan to restore the province’s finances, improve competitiveness and raise living standards for Albertans.”
The new book is available as a free PDF download at www.fraserinstitute.org.
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Ben Eisen, Senior Fellow
Fraser Institute
Jason Clemens, Executive Vice-President
Fraser Institute
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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of think-tanks in 87 countries. Its mission is to improve the quality of life for Canadians, their families and future generations by studying, measuring and broadly communicating the effects of government policies, entrepreneurship and choice on their well-being. To protect the Institute’s independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org