NDP HST Hike Has Municipalities Feeling The Crunch: Younger

July 2, 2010

(Halifax, NS) Liberal municipal relations critic Andrew Younger says the NDP government’s hike to the HST has increased the financial burden on Nova Scotia’s municipalities and in turn, will translate into higher property taxes for businesses and residents.

“Once again, the middle class and the working poor will be forced to pay dearly for the NDP’s broken promise,” states Younger. “The Halifax Regional Municipality is taking a hit of close to $2 million due to the NDP tax hike and we’ve already seen the increases in property taxes on residents here. Other municipalities will be forced to follow suit, if they haven’t already.”

Younger says it’s estimated that Cape Breton Regional Municipality will take a hit of about $1.6 million on their budget this year as a result of this NDP tax increase. Even small municipalities, towns, and villages are facing an average gap of $25,000.

“That might not seem like a lot of money for somewhere like HRM or even CBRM, but in many of these small towns that may mean the difference between survival or not,” states Younger. “Frankly, this tax increase was implemented without any analysis of its impact on our economy.”

Younger points to the Municipality of Colchester as an example of the challenges municipal units will be facing. That municipality is grappling with a $35,000 increase to its operating budget - this is significant, but it pales in comparison to the havoc the HST hike will wreak on Colchester’s capital budgets.

“The two percent increase in the sales tax means the cost of the municipality’s waste management master plan has jumped by $17.6 million, while other capital projects in and around Debert will cost nearly $5.7 million more.”

“It is clear that municipalities and residents are going to take a hit,” says Younger. “It appears that negative impact will be even larger than they expected at the outset.”

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