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![Page 1: 1 The Rise of Western Canada Presented By: Jason Clemens, Director Fiscal Studies and the Centre for Entrepreneurship & Markets.](https://reader036.fdocuments.in/reader036/viewer/2022062421/56649e415503460f94b33435/html5/thumbnails/1.jpg)
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The Rise of Western CanadaThe Rise of Western Canada
Presented By: Jason Clemens, DirectorPresented By: Jason Clemens, DirectorFiscal Studies and the Centre for Entrepreneurship & MarketsFiscal Studies and the Centre for Entrepreneurship & Markets
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Economic Prosperity Takes Economic Prosperity Takes Hold in Western CanadaHold in Western Canada
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Economic Prosperity Shifts West:Economic Prosperity Shifts West:Economic Growth (2006)Economic Growth (2006)
0
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AB NL BC SK MB NB NS QC PEI ON
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Economic Prosperity Shifts West:Economic Prosperity Shifts West:Economic Growth (2007)Economic Growth (2007)
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Economic Prosperity Shifts West:Economic Prosperity Shifts West:Economic Growth (2008)Economic Growth (2008)
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AB BC ON QC MB SK NS NB PEI NF
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Real GDP Per Capita (2005)Real GDP Per Capita (2005)
0
5,000
10,000
15,000
20,000
25,000
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45,000
AB ON CA SK BC QC MB NF NB NS PEI
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Economic Prosperity Shifts West:Economic Prosperity Shifts West:Employment Growth (2006)Employment Growth (2006)
0
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1
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BC AB PEI SK NF NS ON NB QC MB
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Economic Prosperity Shifts West:Economic Prosperity Shifts West:Employment Growth (2007)Employment Growth (2007)
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AB BC PEI NF SK NB QC ON NS MB
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Economic Prosperity Shifts West:Economic Prosperity Shifts West:Unemployment Rates (2006)Unemployment Rates (2006)
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AB MB BC SK ON QC NS NB PEI NL
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Economic Prosperity Shifts West:Economic Prosperity Shifts West:Unemployment Rates (2007)Unemployment Rates (2007)
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AB MB BC SK ON NS QC NB PEI NF
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Economic Prosperity Shifts West:Economic Prosperity Shifts West:Gross Business Investment (2001-05)Gross Business Investment (2001-05)
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Gross Investment vs Expected (2005)Gross Investment vs Expected (2005)
0.00%
5.00%
10.00%
15.00%
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25.00%
30.00%
35.00%
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NF PEI NS NB QC ON MB SK AB BC
Investment GDP Prediction
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Gross Investment vs Expected (2005)Gross Investment vs Expected (2005)
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
45.00%
NF PEI NS NB QC ON MB SK AB BC
Investment Employment Prediction
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Interprovincial Migration (2005)Interprovincial Migration (2005)
-10
-5
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5
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In T
hous
and
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AB BC PEI NS NF NB ON MB SK QC
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Prosperity in Western CanadaProsperity in Western Canada
strong GDP growthstrong GDP growth
increasing per capita incomesincreasing per capita incomes
strong employment growth (job creation)strong employment growth (job creation)
low unemploymentlow unemployment
attracting investment & peopleattracting investment & people
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Investment & Economic Development:Investment & Economic Development:Secret of Success of the WestSecret of Success of the West
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Two Approaches toTwo Approaches toEconomic DevelopmentEconomic Development
competitive tax ratescompetitive tax rates
incentive-based tax structureincentive-based tax structure
cost-effective regulationscost-effective regulations
adequate infrastructureadequate infrastructure
broad-based free tradebroad-based free trade
optimal governmentoptimal government
preferential tax ratespreferential tax rates
subsidies & other supportsubsidies & other support
asymmetric regulationsasymmetric regulations
targeted free tradetargeted free trade
expanded role for governmentexpanded role for government
Create theCreate the
Right EnvironmentRight EnvironmentActiveActive
ParticipationParticipation
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Size of Government: Pillar 1Size of Government: Pillar 1
Size of government Size of government compared to the compared to the economy matters.economy matters.
Western provinces Western provinces have succeeded in have succeeded in reducing the size of reducing the size of government.government.
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Provincial-Local Government Spending as a Provincial-Local Government Spending as a Share of the Economy (2005)Share of the Economy (2005)
0
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Perc
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P
AB ON BC NL SK NS MB QC NB PEI
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Federal Government Spending as a Share of Federal Government Spending as a Share of the Economy (2005)the Economy (2005)
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Total Government Spending as a Total Government Spending as a Share of the Economy (2005)Share of the Economy (2005)
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Includes federal, provincial, and local government spending.Includes federal, provincial, and local government spending.
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Provincial-Local Size of Government Provincial-Local Size of Government (1990-2005)(1990-2005)
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Taxation: Pillar #2Taxation: Pillar #2
The amount we collect The amount we collect (burden) matters.(burden) matters.
The manner in which we The manner in which we collect it (mix of taxes) also collect it (mix of taxes) also matters.matters.
Consensus in the West for Consensus in the West for less and better taxes.less and better taxes.
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Western Canada: Reduce and Reform Western Canada: Reduce and Reform Personal Income TaxesPersonal Income Taxes
BC (2001):BC (2001): 25% across-the-board reduction25% across-the-board reduction
AB (2000):AB (2000): Canada’s only single rate taxCanada’s only single rate tax
SK (2001):SK (2001): reduced rates and increased the reduced rates and increased the
thresholds at which they applythresholds at which they apply
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Western Canada: Where We StandWestern Canada: Where We Stand
25%25%
20%20%
15%15%
10%10%
5%5%
$30,000$30,000 $60,000$60,000 $100,000$100,000
FederalFederal
SKSK
BCBC
ABAB
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Western Canada: Reduce and Reform Western Canada: Reduce and Reform Business TaxesBusiness Taxes
BC (2001):BC (2001): CIT reduced from 16.5% to 12.0%CIT reduced from 16.5% to 12.0% Eliminated general CCTEliminated general CCT
AB (1999):AB (1999): CIT reduced from 15.5% to 10.0%CIT reduced from 15.5% to 10.0% CCT completely eliminatedCCT completely eliminated
SK (2006):SK (2006): Reducing CIT from 17.0% to 12.0%Reducing CIT from 17.0% to 12.0% Eliminating CCT for most firmsEliminating CCT for most firms
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Provincial Investment Climate ReportProvincial Investment Climate Report
Based on 6 years of survey Based on 6 years of survey data (1998-2004) of money data (1998-2004) of money managersmanagers
Includes 7 sections:Includes 7 sections: Corporate income taxes;Corporate income taxes; Fiscal prudence;Fiscal prudence; Personal income taxes;Personal income taxes; Infrastructure;Infrastructure; Corporate capital taxes;Corporate capital taxes; Labour regulation; andLabour regulation; and Regulatory burdenRegulatory burden
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Provincial Investment Climate Provincial Investment Climate Index: 2006 ResultsIndex: 2006 Results
0123456789
10
AB BC SK MB ON QC NB NS PEI NF
Inde
x S
core
(0-1
0)
CIT Fiscal PIT Infrastructure CCT Labour Regulations
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Free Trade: Pillar #3Free Trade: Pillar #3
April 28April 28thth, 2006 – TILMA, 2006 – TILMA
Free trade agreement between AB Free trade agreement between AB and BC covering products, and BC covering products, services, investment, and labourservices, investment, and labour
Fundamental improvement on Fundamental improvement on previous agreement (AIT)previous agreement (AIT)
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Rise of the West:Rise of the West:Not Just Commodities…Smart PoliciesNot Just Commodities…Smart Policies
Smaller, focused governmentSmaller, focused government
Incentive-based tax relief (personal and Incentive-based tax relief (personal and business)business)
Regulatory streamliningRegulatory streamlining
Reduced government sectorReduced government sector
Free tradeFree trade