Commitment to reduce HST firmly in place
TRURO – The jury is still out on how or when the NDP government plans to balance the provincial budget but a promise to lower the HST will be maintained, Nova Scotia’s Finance Minister says.
Nova Scotia Finance Minister Maureen MacDonald was in Truro on Tuesday to speak to a Truro & Colchester Chamber of Commerce luncheon as part of her pre-budget tour.
“Yes,” Maureen MacDonald responded, to a question from the floor during a Truro & Colchester Chamber of Commerce luncheon about whether the government would be sticking to its plan to reduce the HST by one per cent by next year.
The NDP raised the HST in 2010 by two per cent to 15 per cent, making it the highest rate in the country in an effort to increase provincial revenues.
The government is in the final year of a four-year plan to balance its books and while MacDonald spoke about the importance of doing just that, she stopped short of offering any iron-clad promise.
“When we came into government (three years ago), the expert panel said that if we stayed on the road we were on, by next year the province would have a $1.4 billion deficit,” MacDonald said, while speaking to reporters after her presentation.
“We’ve been able to close that gap by $900 million. We still have a year to go to get back to a balanced position. It’s a steep climb but we’re working hard to get there.”
One of the challenges that stand in the way of doing that, she said, include an economic recovery, both at home and abroad, that has been as strong as expected.
“Every province has seen their economic projections change to the negative, really, and Nova Scotia is no different. So we have to recognize that that is the case. It’s outside of our control.”
What can be controlled, however, MacDonald said, are the province’s expenditures.
“We’ve worked hard to do that and we just have to keep working at that,” she said.
In determining the upcoming budget, MacDonald said some belt-tightening options, such as cutting some services, may have to be made.
“Well, budgets are about choices aren’t they? You have choices to make on the revenue side in terms of generating revenue and you have choices to make on the expenditure side about controlling your spending.”
And if new programs are to be added to the government’s agenda, decisions will have to be made “… on which ones you aren’t going to do anymore,” she said.
One of the messages that MacDonald took from Tuesday’s audience, which numbered approximately 75, is the importance of looking after “the most vulnerable people in your community.”
“They want to ensure that I am aware that there are vulnerable people and that balancing the budget isn’t done at the expense of people who struggle everyday, maybe, to put a roof over their head,” she said.
Conversely, however, there are others who believe that balancing the budget should be at the top of her list as finance minister.
“I’ve heard from people in the business community who say balancing the budget is important, it’s a priority for them.”
After listening to the finance minister, Colchester County Mayor Bob Taylor said he believes the province is pretty much on the “right track” towards balancing the budget. But he believes it is too early to reduce the HST.
“As much as we’d like to see it reduced, if we need that to balance the budget, I think we have to leave it there,” he said.
Instead, Taylor suggested looking at ways to cut education costs, perhaps by reducing the timeline for receiving a university degree.
“I think there’s things we can do there,” he said. “I’d say for now, until we get back on solid ground, I think we leave the tax where it is.”
Chamber of Commerce president Don Hay, however, said he was encouraged both by the minister’s apparent desire to balance the budget within its scheduled time frame and to also reduce the HST to 14 per cent next year.
“We’re definitely encouraged by it,” Hay said. “We’ll see what comes out of it but we’re happy from the message.”