A budget for big expenses

Un budget aux grandes dépenses

The government Couillard will deploy for $ 3.7 billion of new measures in this election year. The new spending had never reached such a level since his election in April 2014.

With the unveiling of its last fiscal year before the next election, the minister of Finance, Carlos Leitão, has argued that the “strong economic growth” registered in Quebec makes it possible for these additional expenses. It must, nevertheless, draw from the “stabilization reserve” government to respond to and maintain a balanced budget.

“With this budget, we want to strengthen the trust and build together the future of Québec”, said on Tuesday Mr. Leitão in the national Assembly.

The budget statement contains a plethora of big numbers. They run over the next five years. “By 2022-2023, we will dedicate additional resources of nearly $ 600 million, to give more quality time to families, and to better support family caregivers and seniors,” said the minister in projecting beyond the mandate of the current government.

The “reserve” to the rescue

To fund a portion of new spending in 2018-2019, and to not make it appear deficit, the government has decided to draw more than $ 1.5 billion in the stabilization reserve.

If he is re-elected next fall, and if he holds to what he has written in the budget documents, he will draw $ 3 billion in this reserve within three years — a reserve which has 5.4 billion $. Still there, so they won’t create deficits, it has not the right to do so because of the law on the budgetary balance.

This demonstrates beyond any doubt that this is a budget “electioneering”, according to the Parti québécois and the Coalition avenir Québec, it is the growth of “spending tasks” of the government. It caracolera to 4.7% in this election year, but will fall to 2.8% in 2019-2020, and 2.6% in 2020-2021, according to the data of Finance.

The “high economic growth” spoken of by Carlos Leitão was 3% last year, but be careful: it will slip to 2.1% this year and only 1.7% in 2019, according to the forecasts of the ministère des Finances du Québec.

Federal transfers have increased by 12.3% in 2017-2018, which has contributed to the improvement of public finances for the year ending 31 march. The growth of these transfers must, however, descend to less than 5% over the next 12 months and in 2019.

Taxi, housing, justice, culture, and SME…

After the individuals, the SMES are entitled to tax relief, notably through a reduction of the payroll tax.

The fifth budget, Carlos Leitão embraces wide. There is also the matter of taxi fares and the purchase of a first home. A non-refundable tax credit of about 700 $, will be set up for such an acquisition.

The government promises municipalities a support of $ 62 million over two years to help them cope with the responsibilities that will be their with the legalization of cannabis. The terms and conditions of this support, however, remain to be negotiated.

The system of justice will see its budget grow by $ 500 million by 2022-2023, according to the government plan.

The expenditure of the ministry of Culture and Communications will grow by 11% in 2018-2019.

The envelope of the québec infrastructures Plan 2018-2028 must climb more than $ 9 billion, bringing its total to more than $ 100 billion. It is “the most ambitious effort ever undertaken by a government”, argued the president of the treasury Board, Pierre Arcand.

Attention! To ensure that the measures contained in the budget 2018-2019 come into force, the minister of Finance shall make and adopt by mid-June a draft of the omnibus law amending no less than 12 laws.

Complicated, e-commerce

In the budget documents, the government commits to amend the QST system to the suppliers of goods and non-material without a physical presence in Quebec (like Netflix) have the obligation to register with Revenue Quebec. The measure would be in force on the 1st January next.

In the case of suppliers located in the rest of Canada, this obligation should also apply to the collection and payment of the QST for tangible goods; and clothing, shovels, or anything else. For tangible goods from, not the rest of Canada but from abroad, Québec will be referred to the Agency of Canada border services.

To Finance, it is recognized that the collection of the QST for the tangible goods, constitutes a more complicated problem to solve than for intangible assets. To the extent that the department expects to recover within five years only a part of what he would be entitled to receive. It assesses its tax losses to $ 270 million per year.

“End of plan”

For the pq’s Nicolas Marceau, this budget is only a “desperate attempt of the liberals to retain power”. Keeping an eye on the Coalition avenir Québec, it was estimated that “the recipe of the liberal — cut and then cut taxes — will be more salty if it is served by the CAQ”.

Noting that the fifth budget, Carlos Leitão establishes a financial framework current over the next five years, the chief caquiste, François Legault, has said that the electoral appointment of the 1st of October turned out well.

“This is a budget end-of-plan”, launched by his colleague François Bonnardel, who was more biting than his leader.

The solidaire Manon Massé has a summary in his own way, the five budgets of the government Couillard: “You go back four steps, forward two and one makes the world believe that it was advanced.”

For the minister of Finance, this budget opens the future.

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