Indexation Will Save Saskatchewan Taxpayers $8.1 Million in 2016
All Saskatchewan income tax brackets and tax credit amounts will go up 1.3 per cent in 2016, matching the national rate of inflation.
“Indexation is part of our government’s ongoing commitment to fairness and competitiveness in taxation,” Finance Minister Kevin Doherty said. “This annual measure helps protect Saskatchewan people from ‘bracket creep’ and keeps more money in their pockets throughout the year.”
Indexation will save Saskatchewan people an estimated $8.1 million in 2016, and is part of an array of measures aimed at keeping taxes low. Individual taxpayers now pay no Saskatchewan income tax on their first $19,220 of income while a family of four pays no Saskatchewan income tax on their first $49,800 of income—the highest tax-free income threshold for a family of four in Canada.
A family of four with $50,000 annual income, and deducting $3,000 in child care expenses, has now seen their provincial income tax cut by 100 per cent since 2008—from about $2,300 to zero provincial income tax in 2016.
“Our government's various reductions to personal income taxes since 2008 will have saved Saskatchewan people more than $490 million by the end of 2016,” Doherty said. “Since 2008, about 112,000 low-income Saskatchewan residents have been removed from the tax rolls entirely, and a family of four with $50,000 income will have saved more than $21,000 by the end of 2016.”
Measures to reduce personal income taxes in Saskatchewan since 2008 include:
- Increasing personal, spousal, and child exemption amounts and introducing a new Low Income Tax Credit in 2008;
- Raising personal, spousal, and child exemption amounts again in 2011; and
- Introducing a new First-Time Homebuyers' Tax Credit in 2012 as well as expanding the Active Families Benefit to include all children age 17 and under (previously, it covered ages 6 to 14).
When income tax savings are combined with new tax reduction programs introduced since 2008 (including the refundable Low-Income Tax Credit and the Active Families Benefit), a single person with $25,000 annual income will benefit from $913 in lower provincial tax in 2016 than in 2008. A family of four with $50,000 combined income will see tax savings of $2,977; and a family of four with $75,000 combined income will see tax savings of $2,709, when comparing 2016 to 2008.