Average working people have very little control over how changes to government tax rules impact their salaries. Sure, we can cut back our driving to offset carbon taxes, or, eat less often in restaurants to reduce the GST we pay, but all that pales in comparison to what you could do if you made the rules in the first place.
The immutable laws of salary and taxation don’t apply to politicians. Since the dawn of government, politicians have used the system to line their pockets at virtually every turn. Fat pensions, self-imposed pay increases, per diems, tax-free living allowances, undocumented expense claims and even tax-free salaries have been the order of the day.
So, it shouldn’t be much of a surprise to learn that some St. Albert city councillors want to dodge a federal decision that will tax a portion of their salary that is currently tax-free. As of Jan. 1, 2019, municipal councillors will no longer receive one-third of their salaries tax free. Councillors will now pay an additional $3,900 in taxes and the mayor will pay $12,700 more.
In a 4-3 vote during a governance, priorities and finance committee meeting, council recommended that council salaries be kept whole once the new taxation kicks in. To do that, Mayor Cathy Heron’s salary would be topped up by $19,500 to $131,920 and part-time councillors’ salaries bumped by $5,400 to $51,390. Statistics Canada indicates Alberta’s average full-time salary is $1,154/week ($60,000/year).
Coun. Ray Watkins, one of the three councillors to vote against the recommendation, is to be congratulated for recognizing the attempt at tax avoidance for what it is – unfair. “The average person doesn’t get an exemption on one-third of their income, so why should I?” he said. “To me, it seems kind of unfair to now, at this point, say I’m going to adjust my salary to accommodate for a tax-free ride that I had previously received.”
Waxing like the quintessential politician, councillor Wes Brodhead came to the rescue of the recommendation. “I’d like to see the take-home pay that is coming to our councillors stay the same … I think that’s the fairest to people who have given four years of their life in service to the city.” He makes the job sound like the ultimate sacrifice, and somehow the work is far more important than the toilings of the average Joe.
Mayor Heron, who also supports the bump in pay, cited a 2016 report from the council remuneration and review committee (a committee comprised of residents) that recommended new base salaries of $50,000 for councillors and $125,000 for the mayor. Her logic is if the report says that’s what councillors should make, then increasing their salary to avoid the tax increase is fine with her. Leadership is about standing up for principles, even when those principles appear expensive. It’s not about hiding behind a report.
Our elected representatives have received two recent pay increases. They need to think about that and about the taxpayers who haven’t received increases themselves recently. Let’s hope council takes the opportunity to reconsider this recommendation when the matter comes before council for a final vote.
