On February 4th, Alberta's Lieutenant Governor, Norman L. Kwong, read the Speech from the Throne which contained Premier Ed Stelmach 's promise to eliminate Medicare Premiums within four years; later that day, Stelmach visited the Lieutenant Governor and called a provincial election for March 3rd. If Stelmach is re-elected, as expected, Alberta's elimination of premiums will make British Columbia the only province that uses them.

Don't hold your breath expecting to hear news like that in BC's Throne Speech on February 12th. One of the first things Premier Campbell did after assuming power was to increase MSP premiums by 50%. While they are called "premiums" you cannot choose to forego the insurance and not pay the premium. They are really taxes, and the government will send a collection agency after you if you don't pay.

Like BC, Alberta's premium system offers reduced premiums for low income families. In Alberta, a family of three or more pays no premiums if their taxable family income is less than $32,210 and reduced premiums if their taxable income is between $32,210 and $39,250. In BC, a family of three or more pays no premiums if their taxable income is less than $26,000 and reduced premiums if their taxable income is between $26,000 and $34,000. Even with premium assistance, the premium taxes are regressive. A family whose income is $40,000 pays the same premium as a family whose income is $4,000,000; between the cutoff level for premium reduction and incomes in the stratosphere, the premium tax decreases as a percentage of income as income increases.

It is important that going into his first election as Premier and Leader of Alberta's Conservatives, Stelmach choose the elimination of premiums as his major tax announcement. Compare that to Campbell who gave big tax cuts to those who needed them least and increased MSP premiums by 50%. At the beginning of his second term, in a special mini-budget tabled in the fall 2005 legislative session, the Campbell government announced a further $143 million a year in corporate tax cuts even though he didn't say one word about those cuts during the spring 2005 election campaign.

In Alberta, the Canadian Taxpayers Federation has been campaigning for six years for the elimination of health premiums. Following the February 4th announcement, its website said: "The Canadian Taxpayers Federation (CTF) today declared victory in its six-year battle to see health care premiums eliminated, with the Throne Speech commitment to eliminate the tax over the next four years." It is hard to understand why the Taxpayers Federation hasn't conducted a similar campaign in BC. The answer to that challenge may say a lot about how the Taxpayers Federation works and the influence of who is on its Board from each province. You won't find the names of those Board members on the CTF website.

It is widely expected that a carbon tax will be announced when Carole Taylor tables BC's 2008-09 budget on February 19. If she is looking for a way to make it revenue neutral, she could do no better than follow the lead of Alberta and announce that every penny raised in a carbon tax will be used to raise the income levels for eliminating or reducing BC's premium tax, until the level is raised to the point where the premium tax is abolished. This year premiums in BC are expected to raise $1.5 billion, almost double the $868 million they raised in 1999-2000.

Update: Several readers point out that Ontario has something on its provincial income tax form that it calls "the Ontario Health Premium". When the BC government compares its MSP premium to other provinces it does not include Ontario's so-called premium which is really an income tax surcharge mislabeled as part of the spin to sell it when it was introduced. Ontario once had premiums that were similar to BC's.