MLAs float idea of raising taxes to boost low N.W.T. revenues

Members are looking for money-making solutions after a modest proposed budget was tabled Thursday.

Community members, MLAs have mixed reactions to the proposed 2018-19 budget tabled Thursday

MLAs have mixed reactions towards the 2018-19 proposed budget. MLA Kevin O'Reilly says the government is putting 'inherent emphasis' on promoting mining, instead of looking for other ways of economic income. MLA Julie Green says the government needs to start talking about increasing corporate income tax and royalty rates for mining. (Guy Quenneville/CBC)

There's mixed reaction to the N.W.T.'s proposed 2018-19 budget tabled Thursday in the legislative assembly.

While some people are pleased to see investments in things like mental health resources and education, others are wondering how the territorial government will raise declining revenues in the future.

"We have to develop new streams of revenue," said Yellowknife Centre MLA Julie Green on Friday. "At this point, we are earning more from tobacco sales than mining, oil and gas royalties."

Thursday's proposed budget projects $1.749 billion in revenues in the next fiscal year, while spending $1.713 billion.

That leaves an operating surplus of $23 million — the lowest in seven years. After accounting for capital investments, the government is expected to be left with a cash surplus of just $2 million.

Green said the territorial government isn't expecting the legalization of cannabis later this year, or carbon pricing, to bring a big boost to the N.W.T.'s finances.

"So we have to figure out how to increase our revenues through the resources we have now," she said.

"So adding another tax bracket for personal tax, increasing corporate income tax, increasing royalty rates. We need to start that conversation."

Frame Lake MLA Kevin O'Reilly agrees.

For years, he's been talking about the importance of economic diversification, and he says it's time the government starts looking seriously at other ways it can make money, outside of mining.

Frame Lake MLA Kevin O'Reilly has been talking about the importance of economic diversification for years, saying the government needs to look for ways to make money outside of mining. (Alex Brockman/CBC)

"All you have to do is look at the budget address itself," said O'Reilly. "There's four paragraphs on mining and one paragraph on economic diversification. I think that shows that the sort of inherent emphasis or focus of our cabinet is largely to promote mining."

O'Reilly said the slump in revenues this year — which are largely due to lower mining royalties — means there isn't money to invest in things like the arts or economic diversification.

"We don't have enough money to do it and our government is not willing to go out and get it," O'Reilly said.

He suggested a resource tax as one option the government could pursue to raise more stable revenues.

Dollars for mental health welcomed

However, the budget isn't all bad news.

The government is investing $2.1 million in funding for junior kindergarten, plus an additional $881,000 for inclusive schooling for children at that grade level. That's something MLAs, school boards and parents were asking for last year, that never came to fruition.

Jiah Marlowe, a former student at the Dechinta Centre for Research and Learning, said she was excited to see $1.5 million in the proposed budget for mental health and wellness resources for young people. The new money is expected to put counsellors in schools and communities.

Nahendeh MLA Shane Thompson says he wanted to see the budget address the two Aurora College programs that were put on hold last year. (Randall McKenzie/CBC)

Marlowe, who also works with youth through Dechinta's Kids U program, said it's important to have full-time counsellors year round.

"Mental health doesn't wait."

Set more $ aside for gov't transparency: community member

But there are some additions people would have liked to see in the budget.

"The big ones, I guess, are Aurora College … about the social work program [and Teacher Education Program]," said Shane Thompson, MLA for Nahendeh. "Again, we're not hearing about any intakes. So that's a big challenge."

New enrolment into the two programs was put on hold around budget time last year, after the government stepped back from its original plan to cut funding to the college by $1.9 million. The cuts were put on hold until a review of the entire college could be completed by this March.

Other people were hoping to see more support for government transparency.

David Wasylciw, who runs Open NWT — a website where residents can get information about legislative assembly debates, bills and committees — attended the budget address Thursday.

David Wasylciw runs Open NWT, a website that aims to make government documents transparent for residents. (Handout)

"There's a lot done right now to fix up [government] websites," he said, adding that it would be nice to see more investment in publishing government information online.

Thursday's budget, however, is only a proposal right now.

MLAs will review the document over the coming weeks before passing a final version.

Green says MLAs still have a number of asks, but they realize there is only so much that can be done given this year's low revenues.

"We have been negotiating since November," said Green. "And we'll be negotiating up until the last minute."

With files from Loren McGinnis


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