The Yukon government expects to post a $2.4-million deficit this fiscal year, according to documents tabled in the legislature yesterday.
The 2010 budget predicted a small surplus of $3 million. But even when Premier Dennis Fentie announced these plans in the spring, they appeared unrealistic to many, as it excluded money needed to pay for new collective agreements with teachers and government workers.
True enough, it is largely these costs that threw this year’s budget out of whack – and caused last year’s figures to sink even deeper into the red, said David Hrycan, deputy minister of Finance.
Finalized figures for 2009 now show a $25.67-million deficit. The 2009 budget predicted a surplus of nearly $20 million. Last year’s finances largely fell because of backpay owed to workers.
Yukon’s flip from black to red will provide fodder for Yukon’s opposition parties during this session of the legislature, which kicked off yesterday.
So far, there’s no sign of major announcements by the government – and no hint as yet as to whether Fentie will trigger an autumn election, as is being predicted by some.
The government tabled proposed changes to the Income Tax Act, which will raise the threshold for small businesses and reduce taxes paid by Yukoners who own dividend-paying stocks.
Small businesses currently pay a low territorial tax of four per cent on the first $400,000 earned, before hitting a higher corporate tax of 15 per cent. That threshold would increase to $500,000, to match federal taxes.
Another tax tweak will benefit Yukoners who own dividend-paying stocks. The change aims to prevent dividends from being taxed twice – once when the company issues the payment to shareholders, and again when shareholders file their taxes.
In all, the changes ought to save Yukon citizens about $500,000 a year.
The government also announced Tuesday it will push ahead with plans to ban the use of handheld cellphones while driving by April of 2011.
Steve Nordick, the Yukon Party’s backbencher from the Klondike, made an aborted effort yesterday to put forward a motion that called on MP Larry Bagnell to help defeat the federal gun registry. A vote in Parliament today will determine the fate of a private members bill that aims to kill the registry.
Bagnell, who personally opposes the registry but is being whipped by the Liberal party to protect it, has become the target of Conservative jibes over this for the past few months.
But Nordick’s motion needed unanimous consent to proceed, and Yukon’s Liberals voted it down.
Contact John Thompson at