In a bid to ease the financial burden on Saskatchewan families, the provincial government announced a series of measures set to bring relief in 2024. Finance Minister Donna Harpauer highlighted the implementation of indexation and carbon tax relief as key components of the strategy.
Indexation, a safeguard against bracket creep induced by inflation, will ensure that personal income tax brackets and credits keep pace with rising costs. Harpauer emphasized that a family of four with a $75,000 annual income stands to save $322 in 2024 due to the indexed personal income tax. Additionally, the decision to cease collecting carbon tax on home heating will contribute an extra $400 in savings for the same family, resulting in a total of over $700 in reduced expenses for the year.
The provincial government’s commitment to maintaining low personal taxes is integral to its broader initiative to enhance affordability. Harpauer stated that Saskatchewan ranks as the most affordable province in Canada for a family of four, considering taxes, utilities, and housing costs. Over $2 billion in affordability measures are incorporated into the annual budget, contributing to the province’s standing.
Notably, the indexation of the Personal Income Tax (PIT) system will yield $70.5 million in annual income tax savings for Saskatchewan residents. The 4.7% indexation aligns with the national inflation rate, offering protection against automatic tax increases associated with income growth. The cumulative effect of indexation from 2007 through the 2024 taxation year is expected to save taxpayers approximately $355 million in 2024.
Saskatchewan boasts some of the lowest personal taxes in the country, with PIT exemptions removing over 112,000 people from the income tax roll since 2007. The province’s PIT reductions, totaling over $830 million in annual income tax savings, have contributed to a high tax-free threshold.
Furthermore, the Active Families Benefit, reinstated in 2021, continues to provide relief for families with children engaged in sports, arts, and cultural activities. Eligible families can claim a refundable tax credit of $150 per child per year, with an additional $50 for families with children with disabilities, amounting to a total tax credit of $200 per child annually.