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Federal budget 'good for business'

Jason Unrau
Northern News Services

Yellowknife (May 08/06) - The Northwest Territories will get an additional $50 million for housing, thanks to last week's federal budget.

That was one of the bright spots, said territorial Finance Minister Floyd Roland.



  • 12 per cent small business tax rate cut to 11 per cent by 2009
  • Tax credits for textbooks (up to $520), transit passes, work tools, uniforms etc. (up to $1000) and youth sports
  • Corporate income tax rate drops to 19 per cent from 21 per cent by 2010; corporate surtax and capital tax to be eliminated
  • $1.4 billion more in 2006 for border security and policing
  • $1.1 billion increase over two years for the military although there was no mention of increases for the North
  • lowest income tax rate rises from 15 per cent to 15.5 per cent.
  • $5.5 billion over next four years for border infrastructure and highways
  • $1 billion over five years for pandemic preparedness
  • Universal child care benefit payments of $100 a month for each child young than six begins July 1
  • Projected 2005-2006 surplus of $8 billion with total estimated 2006-2007 spending of $223.6 billion with total revenues of $227.1 billion.


"I'd give it a cautious positive," he said. "I think it's a fairly safe budget that deals with individuals and targets the small businesses increasing the income threshold for small business from $300,000 to $400,000. That will cost us a little bit, but overall it's good for business in the North."

The Conservative government also affirmed its support for the $500 million socio-economic fund promised by the former Liberal government to help cover costs associated with the proposed natural gas pipeline.

But Roland certainly wasn't jumping for joy with an additional $1.9 million for territorial formula financing and was setting his sights on upcoming discussions on improving the GNWT's royalty sharing agreement with Ottawa.

"(The $1.9 million increase) won't really mean much in term of the overall budget," he said. "But the Conservatives' commitment to get together with all provinces and territories to have further discussions about transfer payments and formula financing is my big concern."

Western Arctic MP Dennis Bevington said he will join the NDP caucus in voting against the Conservative government's budget.

"We have a very strong fiscal position in the federal government this year, large surpluses, record corporate profits across the country and now we're cutting taxes and not investing in people," he said, pointing to the Harper government's abandonment of a national childcare system and the Kyoto Accord.

As for the Conservatives' plan to review the aims of last year's landmark Kelowna Accord - in which Paul Martin's Liberal government agreed to spend $5 billion over 10 years on infrastructure, programs and services to improve the lot of the nation's aboriginal population - Bevington was skeptical that the $450 million the Harper government pledged to spend on aboriginal housing, childcare, health and education over the next two years would get the job done.

"When you think of (that amount) in terms of the aboriginal population, they just haven't put enough resources to meet the targets that were set under Kelowna," he said. "It's going to be difficult to accomplish."

Bill Erasmus, vice-chief for the Assembly of First Nations was "disappointed" in the end of the Kelowna Accord.

"The first ministers meeting committed roughly $5.2 billion, and this budget doesn't really reflect what we wanted to do and that was bridge the poverty gap over a 10-year period. We had a real concise plan to do this and we expected that commitment to be followed through on."

"(Conservatives) are saying they want to take a new approach. If that means with a conservative flavour to it, then that's not a problem, but we're unsure as to how they want to proceed because we're hearing little coming from them on the matter."