News Releases

News Release - Manitoba

March 19, 2020

Budget 2020 continues moving Manitoba forward and building a brighter future for all Manitobans, Finance Minister Scott Fielding announced today as he presented the provincial budget in the Manitoba legislature.

“In just four years, Manitoba has made tremendous progress on the road to recovery,” said Fielding.  “Budget 2020 continues the hard work by focusing on the issues that matter most to Manitobans – by providing better services, protecting our environment, making our communities stronger and safer, making life more affordable, and building a better, brighter and more prosperous future for all Manitobans and their families.”

The province is introducing a made-in-Manitoba Green Levy effective July 1 at a flat $25 per tonne that will not increase each year, unlike the federal government’s carbon tax.  The minister noted it will cost Manitoba families and businesses less than the federal carbon tax plan and will be more effective in reducing greenhouse-gas emissions.  In order to offset the impact of the Green Levy, the government will lower the PST rate to six per cent as of July 1.

“Budget 2020 delivers significant tax reductions which, combined with the 2019 tax cuts, are the largest in Manitoba history.  Manitoba will be the only province that has cut its sales tax in recent years and we’ve done it twice,” said Fielding.  “This PST rate reduction will ensure that all who pay the Green Levy will benefit through a lower sales tax rate.”

Combined with last year’s PST rate reduction to seven per cent, Fielding estimated this additional reduction and implementation of the Green Levy will grow the provincial nominal GDP by $108 million, which is good for the environment and good for the economy.  It will increase labour income by an estimated $50 million annually and generate an estimated 1,042 person-years of employment growth.

The PST reduction is expected to create an average annual savings of approximately $345 per household, with approximately 510,000 households in Manitoba.  Combined with an additional $131 in savings estimated to be passed along by Manitoba businesses, it results in total average savings of $476 per year to Manitoba households.

The province will replenish the rainy day fund and will contribute an additional $300 million to the fund by the end of 2020-21.  This will result in a balance of $872 million, at which point the rainy day fund will be fully funded.

“Our province will be in a far stronger position to respond to unforeseen emergencies and we have never been as prepared to deal with those situations,” said Fielding.  “While the previous government left Manitoba without the resources to respond to natural disasters, our government is replenishing the rainy day fund.”

Additionally, the emergency expenditures contingency is increased to $100 million, which is effectively $86 million higher than it was in 2016, and an incremental $45 million available for infrastructure projects aimed at improving environmental resiliency.  The government is determined to complete the Lake Manitoba and Lake St. Martin Outlet Channels Project as soon as possible and Budget 2020 allocates a total of $101 million for the important flood mitigation initiative.

The expected provincial deficit for Budget 2020 has been reduced to $220 million, an improvement of $140 million over the previous year.  Fielding also reconfirmed the government is on track to balance the budget within its current term.  Importantly, the province is also forecasting that its debt-to-GDP ratios will be declining over the next four years, which is a significant signal of improving fiscal health, the minister noted.

“Supported by strong revenue growth and responsible expenditure controls, we are now one step closer to delivering a balanced budget during the current term of government,” said Fielding.  “We have modestly exceeded our plans each year and we are predicting, for the fourth year in a row, an improvement to our earlier forecasts.  We have reduced the deficit each year, while making record investments in health, in education and for families.  We have made life more affordable for Manitobans by cutting the retail sales tax rate, by ending income tax bracket creep and by eliminating many other fees.”

Budget 2020 provides record investments in health care at $6.8 billion and education with $1.3 billion in operating grants to public school divisions.  The Manitoba Health, Seniors and Active Living budget includes funding for a range of capital projects, such as the Health Sciences Centre master campus plan and St. Boniface Hospital redevelopment, with a total strategic infrastructure budget of $1.8 billion.  A $160-million investment on capital projects in the kindergarten to Grade 12 education system will result in 4,425 new classroom spaces either open or under construction by the end of the 2020-21 fiscal year as the government builds seven new schools and several major additions and renovation projects.

The budget commits to keeping Manitobans safe in their homes and communities, and strengthens provincial plans to work with communities and law enforcement to prevent crime.

To view the Budget 2020 documents, visit www.manitoba.ca/budget2020.

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BACKGROUND INFORMATION ATTACHED




Backgrounder
Background Information - https://www.gov.mb.ca/asset_library/en/newslinks/2020/03/BG-Budget_2020-FI.pdf