Sin taxes on the rise; Opposition not happy with budget

Posted By: Canadian Press · 11/20/2012 4:23:00 PM

The life of the new Parti Quebecois government is hanging in the balance as Opposition parties threaten to vote against its first budget, a move that would likely send Quebecers back to the polls.    

The minority PQ's 2013-14 economic blueprint came under fire Tuesday from opposition parties shortly before it was tabled in the legislature.     

If the budget fails to pass a vote, the government could fall about three months after it came to power.     An income-tax increase included in the budget for the province's higher earners is one of the main concerns for both the official Opposition Liberals and the Coalition party.    

The signals from the opposition benches will no doubt spark a flurry of negotiations in the coming days in order to avoid what would be a highly unpopular election.   

 Coalition Leader Francois Legault was categoric in his reaction to the budget. He said none of his 19 members would support it without amendments.     

``We will vote against the budget,'' Legault said before dismissing any chance his party would seek to form a coalition government with the Liberals.    

 Former Liberal finance minister Raymond Bachand said he opposed the budget, but indicated it would be up to his caucus to decide later Tuesday whether the party would ultimately support it.    

The Liberals, who lost power to the PQ in September, are in the middle of a leadership contest to replace Jean Charest. They are likely keen to avoid triggering an election.     

``I'm giving you part of the answer: we will vote against it,'' Bachand said.    

 ``At the same time, there is the question of sense and responsibility. It's a collective decision that the caucus will take.''    

Finance Minister Nicolas Marceau called the budget ''rigorous'' and said he believes it will be passed.    

The budget will see the province eliminate its deficit during 2013-14. The projection keeps the province in line with a pledge made by the previous Liberal government.     To reach its goal, Premier Pauline Marois' government introduced several measures, such as capping annual infrastructure expenditures, cutting back increases on program spending and raising taxes on tobacco and alcohol.    

 The budget also calls for income-tax hikes, something the two major Opposition parties vehemently oppose.    

 Budget highlights include:     

_ The price of a carton of 200 cigarettes will climb by $4. The measure is expected to bring in an additional $130 million in 2013-14.   

 _ A bottle of beer will cost three cents more, a bottle of wine 17 cents more and a bottle of spirits 26 cents more. The government believes it will collect an extra $100 million.  

 _ Quebecers who earn more than $100,000 a year will see their income tax rise by 1.75 percentage points.   

 _ Hydro-Quebec will lose 2,000 jobs through attrition.     _ Capital investments on infrastructure will be capped at $9.5 billion a year, compared with the previously announced figure of $11 billion.    

Marceau said the government was able to balance the books for Canada's most-indebted province primarily by controlling program spending, adding revenues and curbing infrastructure expenditures.     

``We will achieve fiscal balance in 2013-14 and maintain it thereafter,'' Marceau said.     

``There was no question of letting things slide.''     The earlier-than-expected budget appeared to be an attempt by Marois to limit the chances that her minority government became the victim of an Opposition takedown.    

 The PQ has insisted the unusual budget date is a matter of fiscal responsibility, not politics.    

The party said its own accounting shows that Quebec's economic picture is worse than the previous government claimed.    

 With just a four-seat lead in the legislature, Marois will need support from at least one rival for her budget to pass.    

The PQ, which tabled its first budget since losing power to the Liberals in 2003, aimed to shake off doubts it can be a capable economic manager. The party hoped to build credibility with Quebec's business community, all while staying true to the party's left-leaning grassroots.   

  Marois ran on a platform significantly to the left of the other big parties, with a program that stirred concerns within the business community.

Front page photo: La Presse
Photo:  Canadian Press

 

 

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