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Prince Edward Island Budget 2018 - CCUA Synopsis

April 12, 2018

Budget announces $107 million in new spending, surpluses for next three years.

On Friday, April 6th, 2018, the Honourable Heath MacDonald, Minister of Finance for Prince Edward Island delivered a balanced budget for 2018-2019 with a projected surplus of $1.4 million.

Of Interest to Credit Unions

  • New Rural Growth Initiative will provide funding of $2.6 million to communities and organizations.
  • An increase of $32.48 million (4.8%) to sustain and build on the Island’s provincial health system.
  • A new Island Advantage Bursary will see all Island students attending college or university on PEI receive up to an additional $3,600 for a four-year program towards the cost of their tuition.
  • The Debt Reduction Grant will increase to $3,500 a year, meaning students – no matter where they study if they choose to return to PEI – can see up to $14,000 of their provincial student loan forgiven. Approximately 1,300 students are eligible.
  • Free tuition for lower-income students attending post-secondary school.
  • Commitment to provide access to high speed internet at or above 50 mbps by 2020.
  • Increased support to help newcomers settle.
Taxation Measures
  • Small business tax rate is reduced by 0.5% to 4%. The budget commits to further tax decreases in future budgets. CCUA will monitor this commitment going forward.
  • Introduces a Small Business Investment Grant which will give companies a 15% rebate on investments of up to $25,000 (maximum rebate grant of $3,750).
  • The basic personal amount will increase by $1,000 over two years (from $8,160), removing an additional 2,200 Islanders from provincial tax roles.
  • Provincial sales tax will be eliminated on residential electricity use. The provincial portion of HST will also be rebated on firewood, pellets and propane through a point of sale credit or rebate.
Economic Analysis
  • Federal transfers up $60 million, provincial revenues by $43.3 million.
  • Number of employed persons increased by 3.1% - unemployment decreased to 9.8%.
  • Total labour income increased by 4.4%, retail sales increased by 7.4%.
  • Home sales totaled 2,140, housing starts 911 (an increase of 63.8%).
  • CCUA was unable to find any forecasts for 2018-2019 GDP growth, population growth, housing starts, or unemployment.
Revenues
  • Total revenues are forecast to be $1,985,400,000.

Expenses
  • Total expenses are forecast to be $1,983,900,000

If you have any questions, please don't hesitate to contact Jennifer English at jenglish@ccua.com or at 902 219 1711.