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Canada - Transfer GST-cut money to cities, council urges

Timmins city council is joining a growing number of municipalities across Canada demanding the federal government not lower the GST by one per cent in 2008, but instead divert the billions that would be generated to pay for much-needed infrastructure projects across Canada.

Federal finance minister Jim Flaherty recently announced the federal Conservatives plan to further reduce the GST by one per cent from six to five per cent in 2008.



 

This is the same government that recently acknowledged Canada has a $130-billion infrastructure deficit to pay for road upgrades, bridges and water and sewer projects from coast-to-coast, said Coun. Denis Saudino.

The federal government would help a lot more Canadians by diverting every penny of the proposed GST reduction to municipalities and mandating them to spend every penny to upgrade infrastructure, Saudino said.

"The average citizen won't even notice" a further one-per-cent reduction in the GST, but the billions of dollars generated would assist municipal leaders across the country who are struck in a quandary figuring out how to find the cash to pay for crumbling roads and bridges, he said.

Over the past two decades, the federal government went from paying almost all of the costs to build and maintain roads, bridges and water treatment plants to not spending a penny, he said.

The feds downloaded all the responsibilities and costs to the provincial government, which have in turn downloaded the costs to municipal taxpayers, who can't afford it, he said.

"Rather than score political points, they can make a huge impact" and reduce the GST by another percentage point, but hand it all to municipalities to pay for infrastructure upgrades, he said.

"I think we have a very, very serious problem across this country (crumbling infrastructure) and people just don't realize how serious it is," said Saudino.

If billions of dollars aren't directed to repairing crumbling infrastructure in the near future, roads, bridges and water plants across the country are going to start falling apart and municipalities simply don't have the money to repair them, Saudino told city council.

Coun. Michael Doody agreed the municipalities need help to replace crumbling infrastructure and noted the Federation of Canadian Municipalities will be forwarding a motion in the next two weeks demanding all money generated by reducing the GST one percentage point be diverted to municipalities across the country.

Flaherty has shown no indication he's willing to do this, but influential politicians like Hazel McCallion, the popular longtime mayor of Mississauga, are leading the fight and there's a good chance Flaherty will have no choice but to change his mind, Doody said.

Source : Timmins Daily Press - Timmins, Ontario, Canada, dated 30/11/2007

 

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