Oct 2015 Alberta Budget Discussion

[Bill Bumface]

Originally Posted by corporatejay

####, enough with Norway already. It's not like they are some bastion utopia that we all strive towards.

Totally different countries. Leave it alone already.

McMeal at McDonalds (or Equivalent Combo Meal) 15.52 C$
Domestic Beer (0.5 liter draught) 11.64 C$
Imported Beer (0.33 liter bottle) 10.86 C$

[Regorium]

Originally Posted by Fuzz

While Norway isn't good for a direct comparison, they do some things right, that we should have been doing. And that is putting resource revenue in a separate fund, not general revenue. If we had done that from the start, sure we would probably have a PST, but we wouldn't be in this mess AND would have a large fund to use the interest from to finance other things. We also wouldn't have governments depending on it to balance budgets.

I never see people that suggest the Norway model to answer how they would personally be affected by a 15 percentage point increase in income tax and a 20 percentage point increase in consumption tax.

Unless they thought that somehow only "the rich" or "those other guys" pay taxes and somehow a trillion dollars in an oil fund appear.

[corporatejay]

Originally Posted by peter12

Direct access to markets. Minimal pipelines. Biggest difference between us and them.

Well that and they tax the #### out of their citizens so they don't need to use oil revenues for G&A.

[Thor]

lol Jeebus, only regret we don't put money away for the future like they did, not that we should become a welfare state province..... Guys need to calm your jets.

[Tron_fdc]

Originally Posted by CaptainCrunch

to me that's outright stupid, to me, the government shouldn't be hiring people to decrease the unemployment numbers, or to act as a jobs repository.

Would I feel bad if these people lose their jobs? Absolutely. but at this point the government needs to take a serious look at bloat and inefficiencies, the minute you start taking out loans to support your operations, is the minute that your doing it wrong.

to me its the equivalence of taking out a loan to pay for your electricity in your house.

Looks more like vote buying to me....

[darklord700]

Originally Posted by CliffFletcher

Just tell me this - why couldn't Alberta have put all energy royalties into a sovereign wealth fund, and run its government on a tax regime similar to Saskatchewan or B.C. (or Washington state, or Colorado, etc. etc.)?

Let me think, should I trust myself or a former social worker to manage my money for me?

[Fuzz]

Originally Posted by Locke

Sure, sounds nice.

Probably have a PST? Not Norway's 25% VAT?

What about income taxes? 55%? I'm surprised they have anything left to spend on the VAT.

Corporate taxes? 28%-78%

Thanks for replying. Nice of you to read my post. Maybe you can read it again and notice the part where I said they have SOME good ideas. Have you noticed how other provinces in Canada don't have 25% VAT and don't have oil? I also wasn't proposing Norway's expensive social programs. But thanks for coming out.

[Locke]

Originally Posted by Fuzz

Thanks for replying. Nice of you to read my post. Maybe you can read it again and notice the part where I said they have SOME good ideas. Have you noticed how other provinces in Canada don't have 25% VAT and don't have oil? I also wasn't proposing Norway's expensive social programs. But thanks for coming out.

We're borrowing money to keep the lights on and you want to save money from resource revenue. Save it for what? A rainy day fund for another government to blow through?

And what is this now, the Norway Buffet? We want this but dont want that? We want a resource reserve fund but we dont want insanely high taxes to get it?

[CaptainCrunch]

Originally Posted by Thor

lol Jeebus, only regret we don't put money away for the future like they did, not that we should become a welfare state province..... Guys need to calm your jets.

I would argue that even if you were putting money away left right and center that you would then be paying operations costs out of that savings which is incredibly wrong.

[gladaki]

Instead of wasting 5000$ as tax credit for jobs, they should have given tax break and incubators to new business specially if its not related to oil and gas. I didnt see anything which is pushing entrepreneurship.

[Frequitude]

Lol Norway. Ok let's separate, nationalize oil, take a really big saw and cut BC off of North America so we're on tidewater, and take a massive tax hike

Such an uneducated comparison.

[CaptainCrunch]

Originally Posted by Tron_fdc

Looks more like vote buying to me....

Of course it is, their base is union.

Look at their talent roster of MLA's and people working behind them, there's a lot of people that wake up in the morning and sing about the Union label.

[CampbellsTransgressions]

Originally Posted by CaptainCrunch

I would argue that even if you were putting money away left right and center that you would then be paying operations costs out of that savings which is incredibly wrong.

You would pay operations costs off of the revenue generated from the fund when necessary.

You know, like we're doing right now with our measly Heritage Fund (although it wasn't necessary until this year).

I guess we can just wait 50 years and increase taxes then when royalties are negligible. Won't be my problem, so what do I care?

[Flash Walken]

For me as an Albertan now living outside Alberta, the most puzzling thing for me in discussions of politics and economics is when Albertans will seem to dismiss the idea of high taxes while at the same time lamenting not having the resources they create.

"That could never happen here, we have low taxes." As if there is some predetermined, perhaps geological barrier towards raising taxes in Alberta.

I can't make heads or tails of it.

[CliffFletcher]

Originally Posted by corporatejay

Well that and they tax the #### out of their citizens so they don't need to use oil revenues for G&A.

Originally Posted by Locke

We're borrowing money to keep the lights on and you want to save money from resource revenue. Save it for what? A rainy day fund for another government to blow through?

And what is this now, the Norway Buffet? We want this but dont want that? We want a resource reserve fund but we dont want insanely high taxes to get it?

Originally Posted by Frequitude

Lol Norway. Ok let's separate, nationalize oil, take a really big saw and cut BC off of North America so we're on tidewater, and take a massive tax hike

Such an uneducated comparison.

Again, simple question:

Why does Alberta need energy royalties to fund public services, while all the places in the world that don't enjoy the good fortune of royalties (and don't have tax regimes like Norway) seem to get by just fine?

[crazy_eoj]

Alberta's recent history since Klein cleaned up the financial house is really terribly sad.

We've spent almost all of our resource revenues on creating the most expensive and highly compensated public service and employees in the country for decades, while our actual performance based on service delivery to citizens has been average or below average. Almost nothing to show for the dollars spent, except huge powerful unions and massive public pensions.

[GGG]

Originally Posted by Handsome B. Wonderful

Have you ignored the entirety of Canada's history up to this point? There's no such thing.

Saskatchewan NDP under Romanow was fantastic. And really came into power in a similar situation

[nik-]

Originally Posted by Flash Walken

For me as an Albertan now living outside Alberta, the most puzzling thing for me in discussions of politics and economics is when Albertans will seem to dismiss the idea of high taxes while at the same time lamenting not having the resources they create.

"That could never happen here, we have low taxes." As if there is some predetermined, perhaps geological barrier towards raising taxes in Alberta.

I can't make heads or tails of it.

It's not hard to raise taxes when all of your neighbours have high taxes. We don't have neighbours with high taxes. For better or worse, NA is a lower tax environment and businesses and people don't just stay in a region that pushes up taxes when they can just go next door.

So yes, there are barriers, the North American tax climate.

[LChoy]

I use to work in the health ministry in the late 2000s and at that time, and if we took all of Alberta tax revenue into one pot, it would cover less than 10% of the health budget. That is how important royalty revenue is for funding the province.
Alberta doesn't have any other significant source of revenue generators, so if the political and public will continues to demand low taxes and no provincial tax, and no cuts to services either, then there is no other way but to borrow money to fund the province.
The only potential silver lining is that it is cheaper to borrow money. I do agree though that all AB governments never save when times are good, leading to bad times when the pendulum swings back towards the bust cycle.

Lchoy

[puckedoff]

Originally Posted by CaptainCrunch

to me its the equivalence of taking out a loan to pay for your electricity in your house.

Wait are you saying I shouldn't have done that? Can't I just get another loan later to pay back this one?

Here are the assumptions if anyone else interested, but also too lazy to go look. To me WCS seems way too high and nat gas as well but you can be your own expert.