WINNIPEG, MB. - The province released the second quarter report for the 2017-18 fiscal year citing important progress made on expenditure management offset by a decrease in personal income tax revenue, Finance Minister Cameron Friesen said in a news release.
Manitoba’s forecast summary deficit is $827 million, an improvement of $13 million from the projected $840 million deficit in Budget 2017, the minister noted.
Revenue from provincial income taxes are lower than expected as a result of taxpayers advancing income to minimize the impact of federal income tax changes made to the top marginal rate in 2016, Friesen added.
“This loss in projected revenue highlights the impact federal tax changes can have on individuals, businesses and the province’s bottom line,” said Friesen. “Despite this income tax revenue shortfall, we have seen strength in other tax revenue streams, including stronger retail sales tax revenue, as a result of a competitive and growing Manitoba economy, and the benefits of a strong crop year in the agricultural sector.”
The minister noted that continued expenditure management across core government is having a positive impact on the province’s pursuit of financial recovery. The 2017-18 second quarter report is projecting 12 departments to be on or under budget, Friesen added.
“It cannot be overstated the importance of hitting our financial targets as we work toward securing the sustainability of our services today and into the future. When there are events that we cannot control, such as federal income tax changes or other storm clouds on the horizon, the most important thing we can do is ensure we do not spend more than our budget,” said Friesen. “We will also continue to scrutinize and prioritize capital projects ensuring value for money is achieved in all public investments.”
A forecast $981 million for debt servicing continues to be a concern as it impacts the province’s ability to invest in the services Manitobans depend and rely on, the minister added. Finance officials continue to monitor rising interest rates, as any percentage increase would represent millions of dollars that cannot be invested in key priority spending areas, he noted.
The second quarter report for the 2017-18 fiscal year can be viewed by clicking here.
The Manitoba Post with files from the Government of Manitoba