Premier Scott Moe is keeping a campaign promise, and pulling back some of the changes made to PST in last year’s provincial budget.
The provincial government is reinstating the PST exemption for agriculture, which includes crop, livestock and hail insurance premiums. The exemption also applies to individual and group life and health insurance premiums including disability, accident and sickness insurance.
People will still have to pay PST on home and auto insurance.
The tax exemption will be retroactive to Aug. 1, 2017, which is the date PST was first applied to insurance.
The initial expansion of PST to insurance premiums was criticized after the last budget.
Rolling back the change to PST was something Moe promised voters during the Sask. Party leadership race.
Today we announced we will reinstate the PST exemption on crop, life, and health insurance and make it retroactive to August 1, 2017.
We made this promise after listening to Saskatchewan people. And we will keep it while maintaining our 3-year plan to balance the budget. pic.twitter.com/oeV5gSyT1u
— Scott Moe (@PremierScottMoe) February 26, 2018
The change will hit the province’s bottom line, with an expected impact of $65 million in the 2017-18 budget plus a drop of $120 million in the 2018-19 budget forecast.
While many had campaigned for the change, the government is not reversing the decision to expand PST to property and auto insurance.
“We’re set now with respect to the PST, they’ll be some clarification on how that will fit in to our third quarter financial as it is a retroactive decision,” Moe explained to reporters at the legislature Monday.
Moe maintained the government will still be able to accommodate the change in PST revenue within the three-year plan to get back to a balanced budget by the 2019-20 fiscal year.
“We have a plan and it remains on track,” Moe confirmed.
More information will be revealed on Friday when the government releases the third-quarter financial report.
How people will see a refund if they paid PST on these items is still being figured out. The details will be unveiled in time for the provincial budget on April 10.