2012 Newfoundland and Labrador budget highlights
Canadian tax alert, April 24, 2012
The Honourable Tom Marshall, Minister of Finance and President of the Treasury Board, presented the 2012 budget this afternoon. The following is a summary of the tax highlights contained in the budget.
- The 2012 Budget builds on a strong economy, with an estimated surplus of $776 million for 2011-12, but expects some economic challenges in the next few years with anticipated deficits of $258 million for 2012-13 and $433 million in 2013-14 before a return to a surplus position.
- Real gross domestic product (GDP) will increase by a modest 0.1% as a decline in oil revenues will result from two of the province’s three producing oil fields being shut down for a period of planned maintenance. Oil revenues are estimated at $2.2 billion based on $124/bbl.
- Capital investment will increase by 30% to a record $9.6 billion as expansion continues in the province’s mining sector, Hebron oil field and infrastructure projects.
- Net debt is at $7.8 billion, and net debt to GDP has improved from a high of 70% in 2004 to 25% projected for 2013.
- The 2012-2013 deficit is forecast on revenues of $7.2 billion and expenses of $7.5 billion with expenditures growing by 1.7% and nominal reductions in government work force.
Measures concerning business
- No changes in corporate tax rates.
- Over $100 million in funding to increase apprenticeship training and enhance workforce development.
- Almost $200 million to support innovation and development of aquaculture, ocean technology and tourism.
- Over $900 million for infrastructure improvements, mostly road construction and public buildings.
Measures concerning individuals
- No changes to personal income tax rates.
- Seniors will be provided with a 35% discount on a number of items such as motor vehicle registration, driver’s licences and other fees.
- Continued freeze on tuition, non-repayable grants for post–secondary and no interest on the provincial portion of student loans.
Sales tax measures
- No changes to sales tax rates.
- Nearly $3 billion to improve health care for all residents.
For further details on the provincial budget, please visit www.budget.gov.nl.ca/budget2012.
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