The Saskatchewan NDP want the PST removed on municipal construction projects like the one planned at some point for Grain Millers Road in Yorkton.
Grain Millers Drive is a seven-kilometre primary weight road that connects with two provincial highways. Both ends of the road are paved. There is a gravel portion of approximately 4.5 km in the middle.
The Sask. Party’s six per cent PST on construction labour was introduced in 2017 and applies to both labour and materials. The tax cost builders an estimated $484 million every year – driving up the cost of building roads, houses, and infrastructure across Saskatchewan, according to a recent NDP release.
Aleana Young, Saskatchewan NDP Jobs & Economy Shadow Minister, was in Yorkton Jan. 27, where she reiterated the party position.
Young said charging PST on municipal projects is simply a drag on getting important work done.
“One level of government shouldn’t be taxing another level of government,” she told Grasslands News adding that when the PST was placed on materials and labour for such projects it simply drives up municipal costs.
“It’s the definition of a job killing tax.”
It was last August when Premier Scott Moe was in Yorkton pledging to fund up to 50 per cent of the cost of improvements of the roadway citing Grain Millers Drive as a vital transportation corridor that supports significant economic activity in the region.
“Grain Millers Drive is a critical access point for several major agri-businesses and industries,” said Moe at the press conference. “This is a key artery for the movement of goods and services, connecting local producers to national and international markets.”
However, few details came with the August announcement including no actual dollar amount tied to the province’s 50 per cent, how the partnering municipalities – the City of Yorkton and RM of Orkney – would share their 50 per cent of costs, or when the project might actually get under way.
Young went a step farther questioning why Moe would tax such a vital project.
In the recent release Young agreed with the importance of the road, so why force municipalities to pay PST on it?
“Grain Millers Road is essential economic infrastructure for the community and Saskatchewan as a whole — it’s not something that should be used to prop the fiscal disaster Scott Moe has created of our province’s finances,” she said. “Scott Moe is hitting Yorkton twice — first with a construction labour tax on projects like Grain Millers Road, and then again through higher property taxes as municipalities struggle to cover inflated costs.
Young said for Yorkton the PST cost on construction extends well beyond whatever the city’s share of the proposed Grain Millers Road project might be, noting the city is also planning a new wastewater treatment plant, and hope still exists that a new regional hospital will be built the municipality will contribute too.
The PST on such projects simply falls “to the taxpayers of Yorkton,” who pay municipal taxes to pay the provincial tax, said Young. “It doesn’t make any sense.”
But is the NDP’s call likely to illicit change?
Young said change ultimately lies in the hands of people. As urban and rural municipalities and other supporters line up to call for the PST to be removed from municipal projects, she said it would be hoped the Saskatchewan Party and Premier Moe would listen.
The Saskatchewan Party has defended the PST expansion as a necessary measure to help stabilize provincial finances and fund public services, arguing the tax applies broadly across the construction sector. The government has also pointed to infrastructure funding partnerships with municipalities as evidence of continued support, while maintaining that any changes to PST policy must be balanced against the province’s overall fiscal priorities.
