Manitoba delays sales tax cut and carbon tax plan due to COVID-19

WINNIPEG — Manitoba Premier Brian Pallister is pushing back a promised cut to the provincial sales tax because of the financial strain of fighting COVID-19.

Pallister says the novel coronavirus is taking a toll on the economy, and the province will drain hundreds of millions of dollars from its rainy day fund within three months.

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Pallister also says the province is looking at borrowing more than $1 billion and will not proceed with a bill now before the legislature that would reduce the sales tax to six per cent from seven.

Pallister is calling on the federal government to set up a credit agency to lend money to the provinces.

He says the federal government can borrow at lower interest rates, so the provinces could save money by borrowing through Ottawa.

Manitoba has recorded 36 probable or confirmed cases of COVID-19, and health officials say social-distancing measures are bound to remain in place for some time.

This report by The Canadian Press was first published March 26, 2020

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