P.E.I. budget missed opportunity to fight poverty, says economist

The P.E.I. budget could have found better ways to provide relief for low-income Islanders, says a UPEI economist.

Finance Minister Heath MacDonald presented the budget Friday. It included an increase in the basic personal exemption, the amount of money that can be earned before you start paying tax. MacDonald noted the $1,000 increase over two years means an additional 2,200 Islanders won't pay income tax.

UPEI Prof. Jim Sentance argues that tax relief could have been better targeted.

"The low-income people that aren't going to pay taxes because of that are going to be making, you're talking people that are making minimum wage and not working full time," said Sentance.

"The actual working poor, people making $20,000 to $30,000 a year, they're still going to be paying taxes."

The trouble with this approach, said Sentance, is that everyone gets this tax break, rich and poor alike.

He said it would have been better for the province to spend this money offering larger tax credits aimed toward low-income Islanders and seniors.

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