SASKATCHEWAN PEOPLE EARNING MORE AND PAYING LESS IN TAXES

Saskatchewan Advantage Tax Cuts to Take Effect on Canada Day

Saskatchewan residents are earning more and paying less in taxes, with average weekly earnings up 5.2 per cent just as lower provincial income taxes take effect tomorrow.

Saskatchewan residents will see an increase in take-home pay beginning July 1, 2011, as employers adjust their payroll deductions to reflect the income tax reductions announced in this year's provincial budget. The balance of the income tax reduction will be delivered when Saskatchewan residents file their 2011 tax returns.

The 2011-12 Budget announced a $1,000 increase to the basic and spousal personal income tax exemptions, along with a $500 per child increase to the exemption for dependent children.

"These personal income tax measures raise the income threshold at which Saskatchewan residents begin to pay provincial income tax and will remove an estimated 22,000 taxpayers from the provincial income tax roll," Finance Minister Ken Krawetz said.

The improvements result in a family of four paying no income tax on their first $45,550 of earnings - the highest income threshold in Canada.

"More tax-free income than anyplace else in Canada - that's the Saskatchewan Advantage," Krawetz said.

Saskatchewan workers are also earning more. According to a new report released today by Statistics Canada, average weekly earnings in Saskatchewan are now $887.72 - an increase of 5.2 per cent over last year and the third-highest in Canada, behind only Alberta and Ontario.

"Higher wages and lower taxes - that's a great combination," Krawetz said. "It means Saskatchewan is moving forward."

Small businesses will also pay much lower taxes starting July 1, 2011. The small business tax rate will be cut by more than half from 4.5 per cent to two per cent.

"Reducing the small business tax rate to the third lowest in the country improves the tax competitiveness of Saskatchewan's small business sector and encourages a strong entrepreneurial attitude in the province," Krawetz said. "This measure will provide an estimated $80 million in annual tax savings to small business owners - money that will be reinvested to create new jobs and economic activity.

"Lower taxes means a stronger economy and a stronger economy leads to lower taxes. It's a virtuous cycle," Krawetz said.

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For more information, contact:

Kathryn Newton
Finance
Regina
Phone: 306-787-8109
Email: kathryn.newton@gov.sk.ca