The provincial government is forecasting a $1.04 billion surplus in 2022-2023, according to the first quarter report from Finance Minister Donna Harpauer.
This would be a $1.51 billion improvement from what was budgeted and is due largely to higher revenue from non-renewable resources.
Due to this positive forecast, Harpauer announced a four-point affordability plan using the higher revenue to help people address rising costs due to inflation.
Point one of the plan is the Saskatchewan Affordability Tax Credit payment. As announced by Premier Scott Moe on Monday afternoon, all Saskatchewan residents who are 18 years of age or older as of Dec. 31, 2022 and have filed a 2021 tax return will be eligible to receive a $500 Saskatchewan Affordability Tax Credit cheque this fall.
The government estimates the cost of the tax credit will be $450 million and about 900,000 cheques will be mailed out.
Point two of the plan is removing fitness and gym memberships and some recreational activities from the planned PST expansion on admissions, entertainment and recreation in October.
PST will not be charged to residents under 18 years of age participating in activities such as golf, curling, hockey, tennis, basketball, and similar formal sporting activities where individuals in a league or services where a round, game or match are completed. These activities for those 18 and over will still be taxable.
Businesses that qualify as small suppliers for GST purposes will be exempt from collecting PST.
This change will reduce PST revenue this year by an estimated $3 million.
Point three is the plan to extend the small business tax rate reduction at zero per cent retroactive to July 1, 2022, and delaying the restoration of the rate to 2 per cent to July 1, 2024.
It's estimated that this will save small businesses $93.1 million over the next three years, an average of $3,000 for each small business.
Point four is paying down $1 billion in operating debt. Debt is now forecast to be $1.7 billion lower by fiscal year-end than projected at budget, the province's projected surplus provides the ability to retire up to $1 billion in debt, and the province no longer needs to borrow for operations due to the improved financial position.
Information about the Saskatchewan Affordability Tax Credit (SATC) and PST changes is available online is available here.