‘It’s hard to admit you are wrong, but . . . ‘: Prentice reverses budget plan to cut charity tax credit

April 21, 2015 1:00 pm

Calgary Herald

James Wood is with the premier today on the campaign trail.

And here’s his file.

The Tories got it wrong in reducing the tax credit on charitable donations, tPC Leader Jim Prentice acknowledged today as he announced plans to reverse course and restore the original credit.

While the move was hailed by charities, Prentice’s change of heart on the tax credit drew little applause from his opponents on the campaign trail.

In last month’s provincial budget, the Progressive Conservative government rolled back the Charitable Donation Tax Credit to 12.75% from 21% on donations of more than $200.

The government said it would save $90 million with the move and that the rate had been ineffective in boosting donation rates since it was introduced in 2007.

But speaking to reporters, Prentice said he had heard loud and clear that Albertans weren’t happy with the changes.

“It’s hard to admit you are wrong but it is also important to know when to do so. This is how government is supposed to work,” he said at a campaign event at the Sheldon Kennedy Child Advocacy Centre.

“Today, I need to admit that we got one very important thing wrong in our budget proposal . . . we risked putting the good work of Alberta’s many charitable causes and the work that they do at a disadvantage.”

The premier said the Tories will now retain the current 21% rate. The Liberals, Wildrose and NDP had all slammed the budget change by the Tories and had promised to reverse the move.

NDP Leader Rachel Notley said the PC decision in the first place “was definitely evidence of the wrong priorities by Jim Prentice.”

“We’ve heard from people from all sectors who say that that tax credit is critical to helping them contribute to community growth and community support across the province,” she said in Edmonton.

In a news release, Wildrose Leader Brian Jean called the government’s original decision “cruel.”

“Albertans can’t trust the PCs after an election to not hurt charities,” he said.

The budget — which includes tax hikes and a spending freeze as part of an effort to wean the government from its dependence on energy revenues — is the centrepiece of the PC campaign ahead of the May 5 election.

Prentice said he did not foresee any other changes to the document.

The Tories appear to be in a tough three-way fight with the Wildrose Party and NDP, and have been slamming the other parties for inadequate costing of their platforms.

Prentice was not specific over where the Tories would make up the $90 million lost by not changing the tax credit, noting it would be found through “savings elsewhere” He said it would not affect plans to balance the budget by 2017-18.

Eva Friesen, president of the Calgary Foundation, said the tax change had struck a sour note in the charitable sector, especially with the state of the provincial economy.

“When charities were finding fundraising difficult at the best of times because people are being laid off and corporations are sponsoring less … to alter the climate of giving to potentially diminish donor giving was worrying,” said Friesen, one of a number of charitable leaders who appeared with Prentice Tuesday.

“It’s good leadership to recognize when you make a mistake,” she added.

Herald reporters and columnists immediately saw it as a PC reaction to polls showing the party tied with the Wildrose and NDP parties.