GOVERNMENT BUILDS FOR A PROSPEROUS AND COMPETITIVE ECONOMY

The 2003-04 budget continues to build a prosperous and competitive economy through investment in business and research, and further reductions in business taxes.

"Our strong and vibrant economy enables us to build for the future, and we plan to continue that momentum," Industry and Resources Minister Eric Cline said.

Corporation Capital Tax exemptions are being increased for Saskatchewan-based corporations by a further $5 million over the next two years. This brings the total benefit to $20 million for small and medium sized businesses located entirely in the province, double what it was two years ago.

The Small Business Corporation Income Tax rate is being reduced from 6.0 per cent to 5.5 per cent on January 1st, 2004, and further reduced to 5.0 per cent on January 1st, 2005. Cline said this is half of what the rate was when the government first came into power in 1991.

The energy sector contributes significantly to building the economy by generating revenues, creating jobs and attracting investment into the province. Changes introduced last fall to oil and gas royalties and taxes ensure Saskatchewan is competitive with other jurisdictions. Under the budget, the government will also be providing over $3.3 million for an ethanol fuel tax rebate.

The province is finalizing a new Canada-Saskatchewan Western Economic Partnership Agreement (WEPA), and will commit $25 million over the next five years as its portion. Under the first WEPA, a number of significant initiatives were funded, including the Petroleum Technology Research Centre, Greenhouse Gas Technology Centre, International Test Centre for carbon dioxide research, the Saskatchewan Plant Biotechnology Institute wing expansion, and the Saskatchewan Structural Science Centre.

An investment in mineral exploration is an investment in the future. To further enhance mineral exploration, the government will continue to provide $1.6 million for grants and enhanced geoscience. Response to last fall's mineral incentives has been positive. Mineral exploration expenditures, which were at $23 million in 2001-02, are expected to increase by approximately 30 per cent to $30 million in 2002-03.

Last year there was a significant increase in tourism spending in the province and a similar increase is expected this year. To further encourage tourism, the government is increasing its funding to Tourism Saskatchewan this year from $6.9 million to over $7.1 million.

The province is providing $2.5 million towards construction of the new Saskatchewan Forest Centre in downtown Prince Albert, which will begin this year. "The new $12.7 million facility will showcase Saskatchewan's wood products and new technologies, and ensure that the industry has access to the best market research and growth opportunities from across Canada and around the world," Cline said.

The government remains committed to supporting research and development in the province. The province will match federal research funding with $8 million in its Innovation and Science Fund, which provides support to Saskatchewan universities, colleges and research institutes. Over the last three years, more than $33 million has been provided through this fund for 64 projects at the province's two universities. This year's money meets the province's commitment of $41.5 million over four years and the government is renewing its commitment for a further four years.

The Technology Commercialization Fund will contribute an additional $1 million for projects that turn new technology research into marketable products and services.

The province is committing funding of $6 million to the Petroleum Technology Research Centre over the next four years, matching federal funding, for a total of $12 million.

This research funding is in addition to that provided to the $173.5-million Canadian Light Source synchrotron in Saskatoon, expected to begin operation in January 2004. To date, the provincial government's investment in this project totals more than $26 million.

Funding will continue for promotion of the province through the Our Future is Wide Open campaign. "It takes time to change people's perception of Saskatchewan, so we will continue with this three-year marketing campaign profiling Saskatchewan within and outside our borders. After the first six months of the campaign, we are already seeing positive results of increased awareness of our province's advantages," Cline said.

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For More Information, Contact:

Bob Ellis Industry and Resources Regina Phone: (306)787-8277