Higher Taxes on Cigarettes and Fuel, Manitoba News

Manitobans will pay higher cigarette and fuel taxes and see the provincial sales tax applied to several new services in a budget that reduces overall spending or increases it, depending on your point of view. Smokers will pay 2.5 cents more per cigarette effective at midnight Wednesday while drivers will pay an extra 2.5 cents per litre to fill their vehicles' fuel tanks as of May 1. Meanwhile, the government will apply the PST to services such as manicures, pedicures, facials and haircuts that cost more than $50. Finance Minister Stan Struthers also announced the province would "modernize" Sunday shopping laws, although he provided few details. Currently, most major stores can only open their doors between noon and 6 p.m. on Sundays. Businesses have long called for the ability to set their own Sunday hours. Struthers announced several measures for decreasing government administrative costs. As reported by the Winnipeg Free Press, the government will reduce the number of regional health authorities in Manitoba to five from 11. It will also merge the Manitoba Liquor Control Commission with the Manitoba Lotteries Corp. And it will also slash the number of government-appointed agencies and boards. The government also plans to rein in spending by freezing or reducing spending in 10 departments and agencies. Despite those measures, Struthers still projects a $460-million deficit for the current fiscal year. It's a far cry from the flood-induced $1.12-billion shortfall for 2011-12, but still short of where the government hoped to be in its bid to slay the deficit by 2014. The government claimed to be reducing overall spending by 3.9 per cent. But that isn't nearly as miserly as it seems because the province had to spend hundreds of millions of dollars in flood compensation this past year that won't be repeated in the coming year. The province's spending is increasing 3.1 per cent compared with last year's budgeted amounts, said Marilyn Braun-Pollon, a spokeswoman for the Canadian Federation of Independent Business. "That's not sustainable," she said, noting inflation is expected to be 1.9 per cent in Manitoba in the coming year. "Small business owners will really view this budget as moving Manitoba backwards," she said noting the province will collect more than $180 million in new taxes. Conservative leader Hugh McFadyen also criticized the tax hikes, which include adding PST to several new insurance services.