Higgs’ HST cut pledge is the first major policy proposal laid out ahead of this fall’s election. Pictured: New Brunswick Premier Blaine Higgs. Photo Credit: Blaine Higgs/X.
Premier Blaine Higgs made it a priority to pay down New Brunswick’s debt and that means there’s room for tax relief.
And that’s exactly what Higgs is promising to deliver.
At the heart of Higgs’ re-election platform is a new commitment to cut the provincial portion of the HST by two percentage points, which will save the average New Brunswick family $1,000 a year. That’s real money that can help struggling families afford to replace an aging dishwasher, take that extra road trip or send kids to summer camp.
New Brunswickers deserve this tax cut. After six balanced budgets, Higgs has put New Brunswick in a position where it can have a balanced budget and cut taxes.
New Brunswickers also deserve this tax cut because Higgs is reversing a harmful mistake made by a previous government nearly a decade ago. Eight years ago, Higgs’ predecessor, former premier Brian Gallant, raised the provincial portion of the HST from eight per cent to 10 per cent.
Higgs is righting a wrong that has cost the average New Brunswick family thousands of dollars.
Getting here wasn’t easy. The year before Higgs was elected, the Gallant government increased New Brunswick’s net debt by more than $1 billion and ran the province’s tenth straight deficit. At the time, money spent on debt interest charges alone exceeded New Brunswick’s entire post-secondary education budget.
But when Higgs took office, he balanced the books and never looked back. He reduced the province’s debt by $2 billion. And he was the only premier in Canada to lead a government that balanced the budget during the pandemic.
When Higgs became premier, New Brunswick’s debt-to-GDP ratio was above 40 per cent. Now, thanks to Higgs’ focus on debt reduction, it’s down to 25 per cent, one of the lowest levels in Canada.
That debt reduction has created fiscal room for tax cuts. While other provinces face soaring debt interest costs, New Brunswick’s debt interest bill is down by about $75 million this year. Paying down debt has opened up an opportunity to leave more money in taxpayers’ wallets.
Higgs’ HST cut pledge is the first major policy proposal laid out ahead of this fall’s election. With Higgs presenting a clear plan to save families thousands of dollars over the next term, it’s time for New Brunswick’s other parties to step up.
In particular, New Brunswick’s Liberal Party needs to come to the table with plans to lower the tax burden. When the Liberals were last in office, they raised the HST from 13 per cent to 15 per cent. This is Liberal Leader Susan Holt’s opportunity to commit to the very same tax cut as Higgs and right a wrong done by her party the last time it was in power.
Higgs was spot on in committing to cutting the HST. Sales taxes impact every taxpayer. Income tax cuts benefit some, but might miss people such as retired seniors. Cutting the HST will help seniors on fixed incomes, kids figuring out how to stretch an allowance and everyone in between.
Atlantic Canada’s other premiers should also take note. Every province in the region has a 15 per cent HST, the highest in Canada. Higgs has shown balancing the budget and paying down debt can position a province to offer tax relief. Other premiers need to get on board with keeping spending in check to offer their own taxpayers similar relief.
The bottom line is that Higgs’ commitment is a great move for taxpayers. It will save taxpayers money everywhere they shop, make big purchases more affordable and help the most vulnerable.
Jay Goldberg is the Ontario Director at the Canadian Taxpayers Federation. He previously served as a policy fellow at the Munk School of Public Policy and Global Affairs. Jay holds a Ph.D. in Political Science from the University of Toronto.
