Manitoba Liberals will reduce and eventually eliminate the payroll tax in Manitoba

Today, at the Winnipeg Chamber of Commerce luncheon, I announced our plan to reduce and then phase out the job-killing payroll tax.  This will not be done overnight and not likely in four years.  But there are a variety of reasons why it needs to be done. 

The payroll tax is a tax on jobs.  One of the problems with this tax is that in the way it works it provides an economic incentive for companies paying the payroll tax to locate jobs outside of Manitoba.  When companies reach the threshold at which they pay this tax, the extra cost of paying the tax means that personnel who can work from elsewhere may be moved to another province which does not have the payroll tax.   It is a particular problem for locating high paying jobs here and for jobs involving research.  The number of jobs lost in Manitoba over the years has been substantial.

Today, I announced that we will first phase out the payroll tax for publicly funded Universities and Colleges so that they will have extra resources to hire the people they need to provide excellent teaching and research or to look after infrastructure needs.  In the first year, this will provide an extra $6.2 million to Universities and Colleges in Manitoba.

Our approach is to reduce the payroll tax bit by bit in every budget until we can eventually eliminate it completely for all businesses and organizations.  

Reducing and eventually eliminating the payroll tax will be a stimulus to business and economic activity in Manitoba.  Though the revenue from this tax may be lost, the tax revenue generated from other taxes as a result of the new business activity will make up for the loss in payroll tax revenue.  Over time, the reductions in this tax will encourage business and job growth and help our province to grow and for more jobs to be available in Manitoba.