Resolution No. 20-06A

WHEREAS, the Federal Government has made the decision to refund 100 per cent of the GST paid by municipalities; and

WHEREAS, municipalities of the Province of Saskatchewan are expending considerable amounts of money on the provincial sales tax to provide essential local services;

THEREFORE BE IT RESOLVED, that SARM lobby the provincial government to exempt municipalities from paying provincial sales tax.

Response from Kirk McGregor, Acting Deputy Minister of Finance:

The Government of Saskatchewan provides support for municipalities through a revenue sharing formula. This method of funding is a clear and accountable mechanism, designed to equalize local fiscal capacity and support basic infrastructure to meet the health and safety needs of the people of Saskatchewan. For 2006-07, the Province has committed in excess of $146 million in direct provincial spending for municipalities.

Implementing the resolution in exempt municipalities from paying the PST would change the nature of the Province's support for municipalities while complicating the administration of PST.