OTTAWA (Reuters) - The Canadian province of Quebec reaffirmed on Tuesday that it plans to balance its books in the 2015-16 fiscal year after a series of deficits, and said it would raise taxes on financial institutions temporarily to help it achieve its goal.
In the provincial Liberal government’s update on Quebec’s economic and financial situation, Minister of Finance Carlos Leitao also forecast a deficit of C$2.35 billion ($2.06 billion) for 2014-15, unchanged from the forecast in the government’s June’s budget.
“We are determined to return to a balanced budget in Quebec as of next year,” said Leitao, a former bank economist. The Liberals came to power in last April’s provincial election and promised to balance the books by 2015-16.
The government also announced a temporary surtax on financial institutions that will last through March 2017, to be applied to wages paid by banks and other financial institutions and on the premiums insurance companies receive. This will bring in C$42 million in 2014-15 and C$125 million in 2015-16.
It will also raise to 3 percent from 2 percent the capital tax on insurance companies that is applicable to the personal insurance premiums they collect. This should bring in C$42 million in 2014-15 and C$128 million in 2015-16.
Reporting by Leah Schnurr and Randall Palmer; Editing by Diane Craft; and Peter Galloway