CPI lodestone a tax windfall for Sheridan

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Finance Minister Wes Sheridan

Finance minister uses Consumer Price Index to justify increases on property assessments

Prince Edward Islanders have adjusted the time-honoured axiom that the only sure things on earth are death and taxes. In this province, it means higher taxes. A corollary to the axiom has entered our colourful Island lexicon, known as Sheridan’s Law. It suggests the annual increase in the Consumer Price Index (CPI) justifies government to hike fees, services and taxes on almost everything. The only exception to the rule is the refusal to use CPI to increase the basic personal exemption for income tax purposes, as it would diminish revenue. Instead we are actually losing more every year thanks to bracket creep.

Island property owners started to receive their tax assessments last week, which contained a two per cent increase. Finance Minister Wes Sheridan says the hike reflects the increase in CPI. He said linking property assessment increases to CPI was the idea of his tax department and was “a very good fix” that reflects the growth and the value of P.E.I. homes.

Statistics Canada defines the CPI as an indicator of changes in costs experienced by Canadians, obtained by comparing, over time, the cost of a fixed basket of goods and services purchased by consumers. The CPI is used to determine the rate of inflation and allows consumers to compare price changes in their income and financial situation.

The March 2013 to March 2014 CPI increase on P.E.I. was three per cent, the second highest in Canada. Nationally it was 1.5 per cent but the implementation of the HST, which increased costs for goods and services to most Islanders, was blamed for the bigger increase here. So Mr. Sheridan boosted our CPI through the harmonized sales tax and uses that increase to justify increasing taxes and fees — the most recent example being our property assessments. It’s a win-win situation for the minister and lose-lose for Islander taxpayers.

The minister tried to soften the blow of higher property taxes by opining about online delivery of assessments to save the province money in stamps and envelopes. Taxpayers can also pay through installments. It all sounds great but it won’t save taxpayers any money and there won’t be any rollbacks because of savings accrued by the province. That contravenes Sheridan’s Law, corollary a) etc.

 

International students a bonus

 

The statistics speak for themselves. The number of university graduates is stabilizing or increasing in the Maritimes largely because of the influx of international students. The decrease in the number of students in our elementary and high schools across the region was starting to make its presence felt within Maritime universities until a couple of years ago. A push was then launched to recruit and welcome international students on record levels.

That decision stabilized or increased the number of undergraduates at Maritime universities and the influx allowed universities and colleges in the region to curb the line on tuition and maintain staffing levels. It was a necessary move.

On Saturday, UPEI recorded a record number of graduates earning degrees, diplomas and certificates. The 1,006 grads represented more than 60 countries. The soaring number of countries represented by the graduating class is good news on two levels. Not only do those students stabilize our numbers, but it also speaks well for UPEI’s reputation to see large numbers of international students anxious to come here for a quality education.

As UPEI president Dr. Alaa Abd-El-Aziz told graduates, he hopes their education prepared them to respond well in life, help them assess information, understand situations and makes intelligent decisions. As those grads return to the native countries, the president is obviously hopeful they will help make the world a better place to live.

Organizations: Statistics Canada

Geographic location: Maritime, Canada

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Recent comments

  • Ripped Off
    May 14, 2014 - 07:49

    More money for Government to fix there screw ups, less for the working poor. Private business owners you will be ok though, just lay off one or two more employees and work harder yourself to make up the difference. It's too bad sheridan didn't have a real job in life - then he would know what is like to have to work for his money - not just take it out of the hands of the people keeping this province/country going..

  • Peter
    May 13, 2014 - 17:40

    Why doesn't CPI apply to the age exemption for seniors on a fixed income in PEI? I'd love to here from Sheridan on this question.

  • NEW LAW
    May 13, 2014 - 14:58

    Must be a new law> I always assumed Sheridans' Law was NEVER GIVE A SUCKER AN EVEN BREAK