Debates of June 6, 2006 (day 6)

Thank you, Mr. Speaker. My question this afternoon is for Mr. Handley, the Premier, and they’re in connection with the motion that this Assembly passed last February, Mr. Speaker, on the northern residence income tax deduction. Mr. Speaker, in that motion we asked the Premier and the Finance Minister to get in touch with their counterparts in our sister territories, as well as in northern provinces and Ottawa, to gage their interest and their commitment in approaching Ottawa to increase the northern residence income tax deduction, Mr. Speaker; something that has not been addressed since 1991 and something that could, in a very significant way, make a big difference for everyone living in the North to address the high cost of living. Mr. Speaker, has the Premier been able to follow through on this request to make contact with their counterparts and what has the reaction been? Thank you, Mr. Speaker.

Thank you, Mr. Braden. The honourable Premier, Mr. Handley.

Return To Question 65-15(5): Northern Residence Income Tax Deduction

Thank you, Mr. Speaker. The answer is yes, I have discussed this with my northern counterparts and with some of the provincial Premiers, and the Member is correct that this is a national program. It would mean having to make changes not just in the northern zone, but in what we call the intermediate zone, as well. Mr. Speaker, in looking at this with the Premiers from the Yukon and Nunavut, it was our decision to put this one on the back burner until we had made more progress through the expert panel on our territorial financing formula and also on resource revenue sharing. Mr. Speaker, the reason we did that is any increase or decrease, sorry, increase in the northern allowance residence deduction would also cost our government money. That was an issue not just to our territory, but the other territories. For example, if we raised it from the current $5,475 to $8,500 per year, that would mean over a $3 million loss for us. Collectively we determined that it was best to keep our eye on the ball on the resource revenue sharing and financing formula. Thank you, Mr. Speaker.

Thank you, Mr. Handley. Supplementary, Mr. Braden.

Supplementary To Question 65-15(5): Northern Residence Income Tax Deduction

Thank you, Mr. Speaker. That’s a very useful answer. It gives me some indication that, you know, perhaps we should not be quite so literal, if you will, in saying, look, simply increase this deduction. There may be other ways that we can actually get Canada to recognize there’s a higher cost of living here, but also that there may be other ways of achieving that end objective. I’m wondering, you know, where the Premier said this has been put on the back burner, is it still on the radar screen though? Is this still something that there is a collective will to do something with, Mr. Speaker?

Thank you, Mr. Braden. Mr. Handley.

Further Return To Question 65-15(5): Northern Residence Income Tax Deduction

Thank you, Mr. Speaker. Yes, this is still on the radar screen. It’s still something we want to consider. But we need to determine what our fiscal situation will be as a government first through the financing formula and also through resource revenue sharing. Mr. Speaker, other jurisdictions, and we have looked across North America, in fact, I have, what other jurisdictions are doing to reduce the cost of living. Some Members have mentioned to me that in Alaska, for example, there is no Alaska income tax. There’s federal income tax, but no Alaska income tax, and that’s true in some other jurisdictions in the United States.

Mr. Speaker, our objective still has to be to lower the cost of living for northern residents, but we have to do it in a way that’s affordable for us. I think the important piece is that we know what our revenue stream is going to be, and I’m sure the Minister of Finance can speak quite eloquently on this issue for us of how we balance our revenue, our loss of revenue, people’s cost of living and so on. But, Mr. Speaker, in summary, yes, this is very much on the radar screen and one that we do want to look at because we realize that if we do not lower the cost of living, it makes it difficult for people to live here or to attract new people to come live here. Thank you, Mr. Speaker.

Thank you, Mr. Handley. Supplementary, Mr. Braden.

Supplementary To Question 65-15(5): Northern Residence Income Tax Deduction

You know, Mr. Speaker, we can see this on the back burner for a long time. Mr. Roland told us earlier today of his optimistic reaction to the expert panel on financing. I share that optimism. But there are so many other initiatives that are going to take their time to sort of grind out through the system. Mr. Speaker, I think as one of the Members who is involved in this motion -- I moved this motion last February -- I’d like to press the Premier to see if he could have a look at this again, speak with his northern counterparts, and see if we could put some kind of a time frame on advancing this. I’m not expecting instant results, but if we could maybe put something within the next 12 to 24 months that would give us all a gage to measuring our progress. Would the Minister consider going back to set up an actual plan for this, Mr. Speaker?

Thank you, Mr. Braden. Mr. Handley.

Further Return To Question 65-15(5): Northern Residence Income Tax Deduction

Mr. Speaker, I am meeting on at least three occasions with the other Premiers across Canada over the next three months or so. During that time I will raise this one again, but I must say that we have talked about it and we do want to move aggressively in getting the federal government to respond to the expert panel reports that have been out and ask them to deal with that quickly. We are looking at trying to resolve that one by this fall and hopefully then have a better idea of what kind of breaks we can afford to give to our residents. Thank you, Mr. Speaker.