New Brunswick raises basic personal amount, cuts property tax

Steeves said the government has paid down the net debt by nearly a billion dollars over the last four years and with a population on the verge of surpassing 800,000, the government is now building on success.

“To maintain this momentum, we must prepare now,” he said. “Consider the demand for services in health care, education and early childhood development. A growing population also means increased demand for housing and more traffic using our transportation networks.”

While the government is projecting a surplus of $35 million for 2022-23, that’s small in comparison to the $488-million surplus for the current fiscal year that ends March 31.

Net debt will increase over the next year by $15.4 million to $12.99 billion dollars, which represents $16,332 for every New Brunswicker. However the province’s debt-to-GDP ratio, which is seen as an indicator of a government’s ability to pay off its debt, is expected to be 30.1% and continue to drop over the next two years.

In keeping with federally mandated carbon-pricing requirements, effective April 1, 2022, the province’s carbon tax will increase from the equivalent of $40 per tonne to $50 per tonne. That represents an increase of 2.21 cents per litre on gasoline and 2.68 cents per litre on diesel.

In response, Steeves is promising some income tax cuts. He says the province’s basic personal amount will be increased from $10,817 to $11,720 and the low-income tax reduction threshold from $18,268 to $19,177 effective for the 2022 taxation year.

“This will provide an estimated $40 million in personal income tax relief to over 400,000 taxpayers for 2022 and ensure single tax filers with incomes up to $19,177 pay no provincial income tax for 2022,” Steeves said.

Provincial property tax rate cuts that were promised two years ago but postponed because of the financial impact of the Covid-19 pandemic will now be phased in over the next three years, including a 50% reduction for residential properties that aren’t occupied by the owner, such as apartment buildings and other rental properties.

Steeves said in order to protect tenants, the government is imposing a one-year cap of 3.8% on allowable rent increases, retroactive to Jan. 1, 2022. Government spending on affordable housing will increase by $6.3 million.

The province’s health-care budget has been set at $3.2 billion — an increase of 6.4%.

More than 20% of New Brunswickers are aged 65 or older, which is second only to Newfoundland and Labrador, and the province faces significant challenges in providing services.

In response, $38.6 million will be spent during 2022-23 to increase wages for human services workers including home support, group homes and employment and support services agencies. Finance Department officials say that will roughly translate to an increase of $2 per hour.