BUSINESS

Yukon cuts income tax with announcement of record-setting surplus budget

04/02/2015 07:14 EDT | Updated 06/02/2015 05:59 EDT
WHITEHORSE - The Yukon government is cutting personal income tax rates as it announces yet another record surplus budget.

The territory expects to be a staggering $1.37 billion in the black for the 2015-16 fiscal year, said Premier and Finance Minister Darrell Pasloski during a budget address on Thursday.

"We believe in managing finances in a way that ensures we have money when we need it most," he told the legislative assembly on the first day of the spring session.

"I want Yukoners to know that we are committed to continuing with reliable fiscal management."

On Tuesday, the government announced Yukoners would pay less income tax, resulting in annual savings of $5.5 million for residents. There are also no tax increases in the budget.

The budget includes $43 million in carry-over funds that were not spent in the previous fiscal year.

Annual transfer payments from the federal government for the year will come to $874 million, a 2.6-per-cent increase over last year's $851 million in federal funding.

There is another $179 million in federal transfers and recoveries from Ottawa, raising the total federal contribution in the budget to $1.05 billion for this fiscal year.

It is estimated the territorial government will generate $127 million in revenue through its own taxes, plus another $43 million in fees and services, such as the anticipated profit of $8 million from liquor sales and $4.7 million from motor vehicle licensing and registration.

"We believe in managing finances in a way that ensures we have money when we need it most," Pasloski told the legislature.

"Yukoners are tightening their belts this year, which is why we are making these investments and providing tax relief," Pasloski said.

"That's what our fiscal management over the past decade allows us to do."

Last year's initial budget estimate of $1.31 billion forecast a surplus of $72 million, though the surplus is now forecast at $49 million.

The majority of operation and maintenance funding for this fiscal year, $327 million, will go to the Department of Health and Social Services.

The Department of Education is next in line with an estimated budget of $155 million.

(The Whitehorse Star)