On March 24, 2010, Saskatchewan Finance Minister Rod Gantefoer presented the 2010 budget. This balanced budget is the third budget of the Saskatchewan Party. An emphasis on government spending containment was made in the document, with an overall reduction in government spending of $121.3 million or 1.2 per cent from last year’s budget.
While no changes to the provincial sales tax system were contemplated in the budget, increased prices on some tobacco and alcohol products were announced.
Tobacco Tax
The 2010-11 Budget has chosen to highlight the negative health impact from tobacco on the Saskatchewan people. In order to deter tobacco consumption in the province, the tobacco tax rate will be increasing on cigarettes and tobacco sticks by 2.7 cents to 21 cents each. The tobacco tax on cut or loose tobacco will rise to 21 cents per gram, while cigars will see an increase of 100 percent of the retail price (subject to minimum and maximum tax amounts).
The First Nations will also feel an impact to their tobacco habit. Saskatchewan has announced that the current tax-free allowance will be reduced from three cartons per week to only one carton. The intent is not only to increase awareness on tobacco issues, but to assist in generating revenue for the province.
Alcoholic Beverages
In hopes of securing an additional $18.1 million in funding, Saskatchewan has announced that prices on spirits, wine and beer will increase effective April 1, 2010, due to changes in liquor mark-ups. Premium spirits sold in 750ml bottles will increase by 50 cents, while the larger volume bottles of 1,140ml will see an increase of 75 cents. Beer prices will also increase by 75 cents for a dozen bottles, which will remain lower than Alberta’s average prices. Higher end wine and spirit products will see price increases of 5%, but standard 750 ml wine products selling at retail for less than $20 will not be affected.
Further information on the Saskatchewan budget may be found on the province’s web site at: http://www.finance.gov.sk.ca/budget2010-11.