REGINA - This week the proposed new Saskatchewan Revenue Agency got the legislative go-ahead from the Saskatchewan Legislature, as the bill to set it up received legislative approval.
Bill 122, The Saskatchewan Revenue Agency Act, carried by a 43-10 vote on Tuesday, one day after the bill was considered at the Crown and Central Agencies Committee.
The bill establishes the framework for a new Crown corporation that would be responsible for administering taxes. But the new provincial tax agency, which would collect taxes on the commercial side, is still a considerably long way from getting off the ground. The government even hinted this week that agency might not happen at all, if they find it would be too costly.
One of the issues raised during the discussion this week on the bill was how much the potential tax agency would cost taxpayers and businesses. At committee this week Opposition Finance Critic Trent Wotherspoon pointed to Ontario in 2009 where they identified they would save businesses $100 million in compliance costs by moving back to one agency.
Adjusted these same numbers to the size of Saskatchewan he estimated the costs were roughly $16 million for 42,000 businesses in Saskatchewan.
Finance Minister Donna Harpauer had responded by noting the intent was to “benefit our businesses” and save them tax money well beyond the administrative costs.
Wotherspoon made it known to reporters that he was unimpressed with what he heard from Harpauer in committee. He indicated a conservative estimate for how much this agency would cost taxpayers in Saskatchewan was $10 million.
“The other night in estimates in committee, she was justifying the legislation to say this signals to the business community that we want to have this conversation. She also shared that they haven’t done any business case analysis on this front, had nothing to share by way of costs either for taxpayers, or for businesses by way of compliance. That’s not how you do things. It’s reckless, it’s how you get yourself into a really bad spot.”
Wotherspoon added the idea of a provincial revenue agency “has been widely panned by the business community and by the people of Saskatchewan that have taken a look at it. So the minister’s arguments don’t hold water on this front.”
In speaking to reporters, Harpauer noted the biggest cost is going to be the upfront cost for the IT system, but indicated they wanted to find out more details.
“We’re going to do definitely a far deeper dive and analysis going forward,” said Harpauer, as well as consultation with business and business leaders.
“I think that consultation is very important. And if there is absolutely no reason to pursue it, then we won’t go through the cost of everything doing the deeper dive.”
She also agreed, responding to a reporter's question, that the Opposition was perhaps getting ahead of themselves.
“Yes,” said Harpauer. “Well, number one, they put a number to it, but I have no idea how they came up with that number. And I have a letter of support from the Saskatoon Chamber that supports us pursuing this, and wanting to be a part of that consultation.”
She also said the other Chambers and business groups she has met with haven’t issued a formal letter but wished to be part of that consultation as well.
