Alberta to diversify economy once budget is balanced
Alberta’s finance minister says the province will have the luxury of diversifying its revenues once its budget is balanced.
Travis Toews told a Calgary Chamber of Commerce luncheon that the government should look at ways to become less dependent on volatile oil and natural gas royalties in the long term.
But he told Canadian Press the United Conservative government’s priority right now is to eliminate the deficit by cutting spending and not raising taxes.
Toews made his remarks a day after tabling a budget that aims to reduce overall program spending by 2.8 per cent over four years and other measures to balance the books by 2023.
The Kenney government’s inaugural budget calls for scrapping tax incentives brought in by the NDP that were aimed at diversifying the economy toward tech and other sectors.
Toews says the most effective way to get Alberta’s economic engine firing again is to make the overall business climate friendlier with lower corporate taxes.
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The provincial corporate tax rate is to fall from 12 per cent to eight per cent by 2022.
“We’re taking the approach to broadly improve our competitiveness and business environment,” Toews said Friday. “We believe that is the most defensible approach to ensure that capital flows in the right places, that we diversify and grow our economy in a sustainable way, that government isn’t picking winners and losers.”
NDP Opposition Leader Rachel Notley blasted the government for giving tax breaks to big corporations while squeezing post-secondary students and people living with disabilities.
She said the approach is not the way to get off the “royalty revenue roller coaster.”
“You don’t diversify the economy by shutting the doors of our post-secondary institutions, making major cuts in the quality of the education people receive at the same time that you significantly increase the cost to students of walking through the doors of those post-secondary institutions,” she said in Calgary. “And of course, in addition to that, they’ve cut a number of programs that our government had in place that were focused on economic diversification.”
Calgary Chamber of Commerce CEO Sandip Lalli told Canadian Press she’s glad the provincial government has a plan to balance the budget, but she wants to know how it plans to diversify its mix of revenue with the help of innovation.
“Within this plan that’s been tabled, they’re not ready to do that,” she said. “But I would really hope that they still continue to have conversations of ‘how do we move that forward.’”