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A formal system of equalization payments was first introduced in 1957. [7] [ Notes 1]. The original program had the goal of giving each province the same per-capita revenue as the two wealthiest provinces, Ontario and British Columbia, in three tax bases: personal income taxes, corporate income taxes and succession duties (inheritance taxes).
Until the 2009–2010 fiscal year, Ontario was the only province to have never received equalization payments; in 2009-2010 Ontario received 347 million dollars, [7] while Newfoundland, which has received payments since the program's creation, is now a so-called "have" province, and is now a net contributor and does not receive payments.
Equalization is intended to address fiscal disparities among Canadian provinces based on estimates of provinces' fiscal capacity—their ability to generate tax revenues. [5] The equalization program began in 1957 under Progressive Conservative Prime Minister John Diefenbaker to mitigate horizontal fiscal imbalance between provinces. [6]
The outcome gave Alberta's United Conservative Party government and embattled Premier Jason Kenney a mandate to negotiate with other provinces about an equalization payments formula that is widely ...
Equalization payments do not, technically, involve wealthy provinces making payments to poor provinces, although in practice this is what happens, via the federal treasury. As an example, a wealthy citizen in New Brunswick, a so-called "have not" province, pays more into equalization than a poorer citizen in Alberta, a so-called "have" province.
April 16 – The Montreal Canadiens win their ninth Stanley Cup by defeating the Boston Bruins 4 games to 1. The deciding Game 5 was played at the Montreal Forum; May 6 – The Saskatchewan Junior Hockey League's Flin Flon Bombers win their only Memorial Cup by defeating the independent Ottawa-Hull Canadiens 4 games to 3.
In the face of these long-term regional disparities, the Government of Canada redistributes some of its revenues through unconditional equalization payments and finances the delivery of comparable levels of government services through the Canada Health Transfer and the Canada Social Transfer.
Alberta separatism comes from the belief that many Albertans hold that they are culturally and economically distinct from the rest of Canada, particularly Central Canada and Eastern Canada, because of economic imbalances whereby Alberta is a net over-contributor to the system of equalization payments in Canada. [6]