opinion

Opinion: Kenney needs to reverse income tax hike

The last thing Albertans need right now is a provincial government reaching further into our pockets with higher income taxes. But higher income taxes are exactly what Albertans are getting in 2021, courtesy of Premier Jason Kenney’s sneaky backdoor tax grab known as bracket creep.

Bracket creep happens when governments stop indexing tax brackets with inflation, which can push taxpayers into a higher tax bracket even though we can’t actually afford to buy more. Bracket creep also allows inflation to erode the tax free portion of our income.

Kenney introduced bracket creep in his 2019 budget, only a month after he promised Albertans that he wouldn’t be increasing taxes.

“It will be a credible path to bring our finances back to balance without raising taxes,” said Kenney at the time.

With Saskatchewan giving bracket creep the boot in 2021, Alberta is alongside only Nova Scotia and Price Edward Island as governments that don’t index their income tax brackets at all.

Kenney was wrong to break his promise and hike income taxes and he needs to correct the mistake.

The United Conservatives seem to understand that a downturn is the wrong time to hike taxes. For some UCP politicians, a key talking point against introducing a provincial sales tax is that it would be bad timing to hike taxes during the downturn.

Kenney himself said he “cannot imagine a dumber thing to do” during a major downturn than adding a PST.

Back in March, the government acknowledged that providing tax relief is an important way to help Albertans get through this downturn.

“We’re focused on creating tangible savings for households and freeing up necessary cash for businesses to help them through these unprecedented times,” said Kenney while announcing property tax relief.

The government’s news release also stated that “during a pandemic, Alberta households should not need to worry about paying additional property taxes.”

If a pandemic and economic downturn is the wrong time for property tax hikes, isn’t now also the wrong time for income tax hikes?

In the 2019 budget, Alberta’s bureaucrats estimated that de-indexing the tax system would cost Albertans $196 million in 2021. By the end of 2022, de-indexation is expected to have cost Albertans more than $600 million.

It’s a safe bet that most Albertans didn’t send the UCP to Edmonton so they could have their turn reaching deeper into our pockets. Many Albertans surely thought they were electing the Kenney that used to rightly bash bracket creep as a “hidden and regressive tax grab.”

As a member of Parliament, Kenney stood up in question period and fired a blistering query at former federal finance minister Paul Martin.

“How can the minister continue to stand in his place and justify a tax system which taxes people without their even knowing it through this pernicious tax grab called bracket creep?” demanded Kenney.

How would Kenney answer that question now? With all the corporate welfare his government is throwing around, Albertans shouldn’t accept any spin that income tax hikes on struggling families are necessary to help balance the budget.

If Kenney doesn’t think that Albertans should pay higher taxes, then he needs to immediately cancel bracket creep and provide income tax relief to help us through these difficult times.

Franco Terrazzano is the Alberta Director of the Canadian Taxpayers Federation

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Prime Minister Justin Trudeau and US Vice-President Joe Biden walk down the Hall of Honour on Parliament Hill in Ottawa on Friday, December 9, 2016. If Joe Biden’s decision to kill off Keystone XL is supposed to sound the death knell for Canada-U.S. relations, you wouldn’t know it from the newly minted president’s call sheet. THE CANADIAN PRESS/ Patrick Doyle
In wake of decision to kill Keystone XL, Biden’s first foreign-leader call? Trudeau

Biden rescinded former president Donald Trump’s approval of the US$8-billion cross-border pipeline expansion

Protesting farmers and their families gather around a bonfire to mark the harvest festival, which is called Lohri, on a blocked highway in protest against new farm laws on the outskirts of New Delhi, India, Wednesday, Jan. 13, 2021. Changes in India’s farm laws could potentially open up one of the world’s most populous markets and are being closely watched by Canada’s agricultural and economic sectors, say experts. THE CANADIAN PRESS/AP-Altaf Qadri
Changes in Indian farm laws could benefit Canada, experts say

Independent committee of experts to negotiate with opponents of legislation

A sign on a shop window indicates the store is closed in Ottawa, Monday March 23, 2020. The Canadian Federation of Independent Business is raising its estimate for the number of businesses that are considering the possibility of closing permanently. THE CANADIAN PRESS/Adrian Wyld
CFIB raises estimate of small businesses at risk of closing permanently

One in six Canadian small business owners seriously contemplating shutting down

Alberta Premier Rachel Notley shakes hands with Joel Ward, former Red Deer College President and CEO, as Notley announces that the college is now on the path to grant degrees. (File photo by Advocate staff)
Future of Red Deer University increasingly uncertain

MLA’s college update says RDC more like SAIT and NAIT than a university

A man wearing a face mask to help curb the spread of the coronavirus looks into a souvenir shop displaying various of stickers, one of them showing a former U.S. President Donald Trump caricature, in Beijing, Thursday, Jan. 21, 2021. China imposed sanctions on nearly 30 former Trump administration officials moments after they left office on Wednesday. In a statement released just minutes after President Joe Biden was inaugurated, Beijing slapped travel bans and business restrictions on Trump’s secretary of state, Mike Pompeo, national security adviser Robert O’Brien and U.N. ambassador, Kelly Craft. (AP Photo/Andy Wong)
China hopes for co-operation, better relations under Biden

U.S. need to relaunch co-operation in a number of areas

German Chancellor Angela Merkel talks to the media during a press conference on the current situation in Berlin, Germany, Thursday, Jan. 21, 2021. Topics include the decisions taken by the federal and state governments to combat the Corona pandemic, the Chancellor’s upcoming virtual consultations with the heads of state and government of the European Union (EU), and relations with the United States following the inauguration of the new president. (Michael Kappeler/Pool via AP)
Germany’s Merkel stands by Russia pipeline that US opposes

Washington says the project makes Europe more dependent on Russian gas and hurt European energy security

Belarusian President Alexander Lukashenko, left, greets International Ice Hockey Federation President Rene Fasel during their meeting in Minsk, Belarus, Monday, Jan. 11, 2021. (Nikolai Petrov/BelTA Pool Photo via AP)
Lithuania offers to replace Belarus as hockey worlds co-host

Tournament scheduled to run May 21 to June 6

Canadian international midfielder Jeremy Gagnon-Lapare, left, is seen in action against St. Louis FC in an undated handout photo. Gagnon-Lapare has joined HFX Wanderers FC on a two-year deal with a club option for 2023. THE CANADIAN PRESS/HO-HFX Wanderers FC
Canadian international Jeremy Gagnon-Lapare joins CPL’s HFX Wanderers FC

Gagnon-Lapare most recently with Ottawa Fury FC and St. Louis FC

An Italian police officer stands by a copy of the “Salvator Mundi” (Savior of the World) by Leonardo da Vinci, in Naples, Italy, Wednesday, Jan. 20, 2021. Italian police have recovered a copy of Leonardo da Vinci’s 16th century “Salvator Mundi” painting of Jesus Christ that was stolen from a Naples church without the priests even realizing it was gone. The discovery was made over the weekend when Naples police working on a bigger operation found the painting hidden in an apartment. Police chief Alfredo Fabbrocini said the owner offered a “less than credible” explanation that he had “casually” bought it at a small market. (Italian Police via AP)
Italian police find stolen copy of Leonardo ‘Salvator Mundi’

500-year-old copy of Leonardo da Vinci painting

Kamala Harris is sworn in as vice president by Supreme Court Justice Sonia Sotomayor as her husband Doug Emhoff holds the Bible during the 59th Presidential Inauguration at the U.S. Capitol in Washington, Wednesday, Jan. 20, 2021. (AP Photo/Patrick Semansky, Pool)
Inauguration fashion: Purple, pearls, American designers

Joe Biden wore navy blue suit and overcoat by Ralph Lauren

Adam Hadwin, of Canada, chips to the second green during the first round of the Masters golf tournament in Augusta, Ga., Thursday, Nov. 12, 2020. THE CANADIAN PRESS/AP-Matt Slocum
Adam Hadwin hopes to hit reset button in 2021 starting with American Express

Adam Hadwin hopes to hit reset button in 2021 starting with American Express

Japan's Yuto Totsuka competes during the men's World Cup freestyle halfpipe snowboard event in Calgary, Alta., Friday, Feb. 15, 2019.THE CANADIAN PRESS/Jeff McIntosh
Calgary runs out of runway to host world freestyle, snowboard championships

Calgary runs out of runway to host world freestyle, snowboard championships

Most Read